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Good morning, everybody, Happy Tuesday. We have an amazing show for everybody today. What do we have?
Firstall, indeed we do.
We have breaking news this morning with regards to the debt ceiling. We will break down those developments for you as a deadline approaches incredibly quickly, more quickly than we were really expecting. Also, some new quite troubling warnings about AI from people who have worked on it, who know a lot about it, so we will break all of that down for you.
We're going to review.
DeSantis's international struggles and the way that was covered by the media as his fight with Disney seems to escalate. We've got fallout from what we covered yesterday, the second largest bank failure in history. What is that going to mean going forward, We've got new numbers on trust in the media.
You will not be shocked.
And my personal favorite block today some leaked audio from Tucker Carlson before he left Fox News, which is rather entertaining and revealing and all of those good things.
Also the collapse of Ice can't talk about can't forget about that.
Yeah, that's right, which is pretty wild. I mean, wece was like the news outlet to be between them and BuzzFeed News collapsing.
I know it is wild.
And also I know Soccer is very excited to talk to James Fox, who is a filmmaker behind a Moment of Contact which I watched last night and you watched previously and is very interesting, So excited to talk to him as well. But we did want to start with that big breaking news with regards to the dead ceiling.
Yeah that's right, let's go and put it up there on the screen. Guys, this is just a very important update for everybody. The President actually called Speaker McCarthy yesterday while he was traveling abroad in Israel, and President Biden asked McCarthy to meet the date of the meeting has
been set now for May ninth. Now The reason that that call is so important is because it came just basically about twenty or thirty minutes after the Treasury Department officially advised all of us on the day that the actual debt limit will be hit.
Let's go and put this up there on the screen.
Secretary of the Treasury Janet Yellen saying that the US could hit the debt ceiling by June one. That is a lot earlier than a lot of initial projections. If we parse her letter crystal something that she said that it could be basically plus or minus a few weeks if they don't exhaust so called extraordinary measures, but saying that that is basically the deadline as to when the
US would likely default on instead. It also just because so much of this, While we may not technically default or not, there is an expectations game where if the Secretary of the Treasury says it's June first, then Wall Street will act like it's June first. So even if you technically have a day or two left like that's the day, though, that the market will likely crash got and that could mean then disaster.
So what does that mean for everybody?
Obviously, Biden blinked he kept saying, I'm not going to negotiate. I'm not going to negotiate. It's like, okay, well you call it, Speaker McCarthy.
Now we're negotiating.
He has called in all four congressional leaders, so Mitch McConnell will be there, Chuck Schumer will be there, and jakeem Jeffries will be there as well. They're going to try and strike some sort of bargain. Reporting currently indicating Crystal that Mitch McConnell wants to stay out of it. I don't really believe that for a second. There's got to be some sort of Jekyll and Hyde situation going on behind the scenes. But almost certainly a deal of
some kind is going to get struck. At least that's what I think, just because Biden kept saying it would negotiation.
And you know, this is kind of what I was saying earlier too. It's so stupid.
It's like, look, obviously we're all going to negotiate, so let's just start negotiating. We will see now though, where that goes. Here's part of the issue. Scheduling wise, we got a month, okay, but President Biden's gonna be gone for a week, he's leaving the country for almost nine days.
It's going to be it works like three hours away three hours a day, and.
He's going to Japan and Australia, so he's going to be tired. Yeah, so we could add that in there.
So really we've got like twenty days to actually get this done. And not only do we need a bargain, we need to not only have the negotiation. It's going to pass the House and then pass the Senate and then get signed by the President.
What are we going to do?
I think the President has played this extremely poorly. Yes, if you say you're not going to negotiate, then don't negotiate with terrorists, I mean, and that's what they are. Holding the economy hostage at a time that things are very precarious. I mean, we just literally had the largest
bank failure, second largest bank failure in history. When you add together these three bank failures that we've had in a very short period of time, is actually larger by dollar amount than what we had in two thousand and eight. So that's just to underscore the procarity.
Of the economy.
As the FED continues raising interest rates and you want to play games with the stats dealing. This is where the fact that Biden is this like norm abiding institutionalist becomes a disaster, becomes a potential global disaster, becomes a disaster for regular people, becomes a disaster for the economy. He shouldn't negotiate, He should stick to his guns. He
should take one of the extraordinary measures. He at least should not take those off the table, because that's the only thing he has to put pressure on the Republicans who are taking, in my opinion, in an unconscionable position here. And so you know, I think he blinked. I think it shows incredible weakness. And I also think it's part and parcel with the fact that with Ron playing out as chief of staff and with Jeff resigns in, Biden has made this very clear like pivot towards the center
or towards the right. I would say that this is, you know, part of that, the idea that we're going back to the Obama days and we're going to have some kind of grand bargain or sequestration or whatever. I just think it's incredibly weak and that he's really mishandled it.
I think it is mishandled it. In two ways.
As you said, you know, you're either going to do the extraordinary measures to say screw you, or you should have been negotiated now for months and not even let the turmoil happened. But we're almost trying to have it both ways by trying to appear tough but then also buckling. So it's like, dude, you got to choose one. You know which way are we going down here? So look, well,
all see, we'll keep you guys updated. It matters for all of us, our the US economy, stock portfolios and all of that, so make sure that you keep that in mind. And we just wanted to give everybody a quick update on what, unbelievably is the biggest news. Also, we did want to say to all of you, thank you all so much to those of you who have been signing up for premium memberships who've been helping us out as we are building the new studio. We showed
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That helps in terms of cash flow realizing at this moment.
But the idea that we don't love and appreciate you is ridiculous.
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Desk if it wasn't for Shane Smith's Vice Guide to North Korea. And you know, we're going to avoid all the mistakes that they made over there.
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Let's get to the news here on artificial intelligence, absolutely extraordinary development yesterday. Let's put this up there on the screen, The quote unquote godfather of AI has left Google and is now warning of dangers ahead. The so called godfather of AI's name is Jeffrey Hinton. He's actually a scientist in his seventies who has been working in the AI.
Field since the nineteen seventies.
Crystal his company, was actually bought by and acquired by Google in twenty twelve, and he's been at the forefront of AI development now for decades. He actually won the Turing Award along with some colleagues.
And has which is basically.
Considered the Nobel Prize of computing. Now, within that, what is doctor Hinton saying. Doctor Hinton is warning that bad actors could use AI to supplant humanity. Possibly, he is warning that the previous idea, which he thought was far fetched, which is that AI could at one point match human intelligence and even go beyond, is much closer than is
previously known. He quit Google specifically because he wanted the ability to speak out not just against the company, but against AI development and call for better regulation around it. But really what opened my eyes was he sees this as a race to the bottom because he believed while working at Google that they were taking their best steps to responsibly develop this products. But then what changed everything Microsoft's partnership with open Ai and the integration of chat
GPT into the bing search system. That has lit a fire inside of Google for the first competition really that they have faced in what decades, you know, in the history of the entire company BA basically ever since they've created AdWords, they've been printed money over there, and they've
always enjoyed basically a monopoly on search. For the very first time, they believe that they have an existential threat to their business, which means they are much more likely to discard any safeguards that they might have in place and go forward and developing technology which can't you can't take it away. Once you go forward, it's in the system, and it's out in the in the sphere, and then
other countries could use it. He's also especially concerned Crystal about the use of AI robots in combat, something that he currently sees is inevitable.
Yeah.
In fact, he's spent his career avoiding He actually took you went and worked in Canada for a part of his career because he wanted to avoid taking any Pentagon funding for AI, because he's very opposed to these systems being used on the battlefield, Which shows you this is I think a principled person Number one. Number two, I really recommend people read through not just this one, but we're going to highlight a few warnings from other people
who are serious, thoughtful experts in the subject. And even if you think what doctor Hinton is saying and what some of the others are saying is overwrought, if there is a one percent chance that they are correct, we have to take dramatic action. I mean, some of these experts are warning this could literally be the end of humanity.
Now, is that like guaranteed?
No, do I have any way really of assessing whether that's overwrought or not. I don't know if there's even a one peron there's even one point one percent chance that they're correct, we should be taking dramatic action. So that's the frame with in which I'm you know, viewing all of these comments and all of this analysis me read you a few of his words just to give
you a sense of him and what he's arguing. Specifically, he says that he consoles himself for his involvement in developing this AI, with the normal excuse if I hadn't done it, somebody else would have. It is hard to see how you can prevent the bad actors from using it for bad things. Maybe what's going on in these systems, he goes on to say, is actually better than what is going on in the brain. The idea that this stuff could get smarter than people. A few people believe that,
but most people thought it was way off. I thought it was way off. I thought it was thirty to fifty years or even longer away. Obviously I no longer
think that. He compares the development of the say to basically a nuclear arms race and says it should be handled in at least as a gross of a manner, but also points out that it's actually more difficult to deal with than that, because you know, there are telltale signs when country like you know, North Korea or on whoever, is developing a nuclear there are ways for us to see.
This would be a lot easier to hide. So even if you have some sort of a global agreement to shut down the development of the AI until we can wrap our hands around it, at the very least to be able to police that would be.
Extraordinarily, extraordinarily difficult.
They say, Unlike with nuclear weapons, there's no way of knowing whether companies or countries are working on the technology and secret. The best hope is the world's leading scientists to collaborate on ways of controlling the technology. He goes on to say, I don't think they should scale this up more until they have understood whether they can control it.
And that's one of the key pieces here is with these large language models, even the people who you know are developing the technology don't really fully understand what's going on under the hood, because you sort of turn this thing loose and feed it all of this information from you know, the web and other sources, and then you
let it go and do its thing. And so that's why you end up with Sydney, the the big chatbot, sort of go and rogue and professing her quote unquote love to Kevin Russ, this New York Times reporter.
These are not.
Behaviors that the people who designed this AI expected Sydney to engage in. So it just shows you that even the people who are the experts in the field, who are developing the technology right now, even they don't really know what's going on under the surface and what sort of results it could ultimately lead to.
Yeah, I think that's a really important point. And it's also there are several canaries in the coal mine who now look a lot better and were treated than at the time. One of them is Blake Lemoyn. Let's put this up there on the screen. He's that former Google engineer who actually went viral about a year ago whenever he went on the record with the Washington Post to warn that Google's language system had come to life and achieved sentience.
He was actually widely mocked at.
The time, not going to deny, and definitely has some interesting personal beliefs religious but hey, it's a free country. And one of the things that that he says is he worked on you know, so called AI ethics. He's a long time engineer, and he was absolutely convinced that sentience and some sort of feeling had been achieved by the system and that it was being hidden by Google.
And now here's the thing. At the time, everybody thought he was kind.
Of crazy, as I said, alluding to his own personal religious issues. But the point is that now if the so called godfather of Ai, the Nobel Prize winning in computing, a decades long Google employee in one of the heads of the program, is now coming out and vindicating at least somewhat what Blake Lemoinne was saying in that article, I think we had to take it a lot more seriously, Crystal.
Yeah, and you know, gets into these technical discussions about Okay, what is sentience technically and how would you test it? I mean the old test used to be could you have a conversation with this thing and not know that it wasn't human? Well, you know, we've clearly like we've
flown by that. And he argues that in a sense, the question of sentience is kind of a distract because whether or not it has self awareness may not be the most relevant question in terms of what it means for humanity and what it means for the world and how it behaves in the world. So he says, I don't like playing those word games with regards to whether or not it's sentient, But if it makes some people feel better, use the right vocabulary. Okay, fine, whatever flows
your vote. What it comes down to is that we aren't spending enough time on transparency or model understandability. I'm of the opinion that we could be using the scientific investigative tools that psychology has come up with to understand human cognition, both to understand existing AI systems and to
develop ones that are more easily controllable and understandable. That gets to what I was saying before about how even the people that are developing these things don't really understand what's going on underneath the hood and what sort of results that will end up with the AI achieving. He also talks about the fact, and I think this is really important that what we have seen as a public that is not the furthest bleeding edge of where this
technology is. So he says, by this time the public learns about an AI product, the companies who built it, they've vetted their pr story, they've consulted with their lawyers, they've potentially lobbied regulators to get preferential legislation passed. Says that's one of the things I always dislike. Tech companies will try to get legislation paths that will govern technology that regulators do not yet know even exist. So that's
the game that they're playing in Washington. He goes on to say, they still have far more advanced tech that they have not made publicly available. The system he was playing with when he came to the conclusion this thing
has some sort of sentient awareness. He describes it as heavily multimodal, not just incorporating images, but incorporating sounds, giving it access to the Google Books API that stands for Application Programming Index, giving it access to essentially every API back and the Google had, and allowing it to just gain an understanding of it all. That's the one that I was like, you know, this thing, this thing's awake, and they haven't.
Let the public play with that one.
But Barred, which is the Google AI, is kind of a simplified version of that. So it still has a lot of the kind of liveliness of that model. So as much as what we've seen publicly is sort of mind blowing and a little bit terrifying, what these companies have that they haven't turned loose to the public is, you know, orders of magnitude more advanced. So what's going on there? You know, what's going on underneath the hood there?
What are the implications of that. I don't think there's a person on the planet who can really say with certainty.
Yeah, I think you're absolutely correct. There's another important point. It's kind of like with computers, by the time it's off the assembly line, it's completely obsolete relative to what they're developing. And let's say Apple Labs or inside of Microsoft or any of these other places, it's probably two to three years out of date. That's the case with any mass consumable technology, and especially in the realm of software, what is completely experimental versus what is being shipped is huge,
like massively apart. And anyway, I think we should really heed his words, the godfather of AI, and I think this is you know, this world remain one of the biggest stories in the world now. Also in terms of politics, it has already come into the political system. You know, a lot of people didn't notice, but the GOP's Republican response to President Biden's reelection was actually done with AI generated images, and we have.
Some of that we can play for you. Let's take a listen this just.
In we can now call the twenty twenty four presidential race for Joe Biden.
Montro this morning and in Bolton, China invades Taiwan.
Financial markets are in free fall as five hundred regional banks have shuttered their doors. Border agents were overrun by a surge of eighty thousand illegals yesterday. Evening Shells closed the city of San Francisco this morning, signing the escalating crime and fentonal crisis.
Who's in charge?
You?
It feels like the train is coming off the trend. So that was an AI generated ad. Let's go and put this up there on the screen, guys. These were AI created images that showed Biden and Kamala Harris celebrating at the election day party reports about international domestic crises. These images were actually used through both I think either mid Journey or Dolly two. Now, these are obviously things that we have seen be used in the creative system.
But this is the thing about this type of technology. Anybody can use it, and it was done exactly so that they could have a rapid response ad almost immediately after it was.
Done, and like who can deny? Look like those?
It was quicker than photoshop and you know, put the merits or whatever of the ad aside. It makes it come to life more when you have that type of imagery that you can look at and that you connect with and that you can bring into like into reality more rather than just a photoshopped image or a past getty image that somebody is usually using.
And this technology to me seems to have really developed quickly, I mean from when we were first playing with Dolly and then you get these like weird images like healthscape dystopian images that you could tell right away were you know, created by AI. These If you pause the video you can see some of those telltale signs. I saw people pointing out like one of AI has some trouble with
human hands, in particular in that first scene. I think it's Biden at like the inauguration, where you can tell his hands or like a little freaky if.
You look at it.
And then the other thing, it's it can't do teeth properly, like puts way too many teeth in people's mouths. And there's an image of him and Kamala Harris where both of them have like way too many teeth, which actually serves to make them look more sort of like villainous and evil in the ad in my opinion, yeah, it makes them.
Yeah, it's sort of like caricaturish.
But if what it made me realize is when you string all of these image images together in sequence, you don't have time to really process what exactly about it is off, So you don't really have time to immediately have that trigger of oh.
This was AI generated.
So that was a revelatory for me, but also the fact that yeah, this is already, this isn't We're not talking about something that's far off in the future. We're talking about something that is here right now. And we have a couple other stories that you know, serve to make that point as well.
Oh yeah, I mean, look, I just think it's important for people to see like, it's here now, it's over, Like the twenty twenty four election is now going to be, at least in part, the AI election, and that's going to change a lot of things.
And speaking of change, we're going to get.
To one now of my favorite stories, which does make me very hopeful about AI. So when I was in college, there was this book company called cheg where you could rent your textbooks, and everybody was doing it because at least it was cheaper than the goddamn bookstore. However, cheg since then has expanded almost dramatically. I guess I don't want to get sued by anybody here. Let's just say that they have internal products which help students on quizz exams and other things for standard curricula.
Some people have called it cheating.
Some people educators have called it a place which is basically legalized cheating. And they have been printing money ever since. Their stock has been a longtime profitable company. Well, in a fascinating new filing, let's go ahead and put this up there on the screen, guys, they say this quote. In the first part of the year, we saw no noticeable impact from chat GPT on our new account growth,
and we were meeting expectations on new signups. However, since March, we have seen a significant spike in student interest in chat GPT, and we now believe it is having an impact on our new customer growth rate.
That line alone.
Sent the stock tumbling thirty seven percent, Crystal thirty seven percent. Now, keep in mind, check is a twelve billion dollar company. It was literally actually on the cover of Forbes magazine in twenty twenty one. The cover said this, this twelve billion dollar company is getting rich off students cheating their way through COVID.
No, once again they said it not me.
Now.
What they say is that the cheg Study program, which was fifteen dollars a month that you can buy from cheg was one of those that you could subscribe to. Is basically a subscription product which you know, you could get essay prompts and other standardized curricula and students and others who had either filled out prompts for and in some cases people who work at check basically helping you know, richer kids or at least kids with money easily more
make their way through college. Well what do we know now, though, which is that chatchept has disrupted so much, not only of the way that kids cheat, but of the way that educators are working their way around cheating as And that's why I actually still believe chat gipt could save education, wrote stupid. Busy work has always been the bane of these It was only created because of bureaucracy and the
need to box check and all that. Now we have to get back to a place of in person essays, which requires spontaneity and thinking, which you can't you know handwritten you can't use a computer.
By the way, there's a lot of evidence.
You can go listen to doctor Andrew Huberman's podcast about why handwriting something out is much better for you than typing. Take it from a guy who probably has terrible handwriting and actually doesn't.
Write anything down.
I still do think that there's a big role for that, especially whenever you're trying to learn and absorb information. But second, and probably most important, is it's bringing back in person discussion inside of classes. I remember, I'm sure you do as well, being some of those gen ED classes with four or five hundred people, It's like, what are we doing here?
This is you know, we're all to box checking some BS gen ED requirement.
The guy doesn't want to be here, he's like some adjunct getting paid like one thousand dollars a semester, eating Ramen in his apartment. Everybody in the class doesn't want to be here. Everyone is just fake doing the reading. It's all BS, except everybody in the room is taking out hundreds of thousand dollars or whatever in student debt. So let's get away from it, let's actually learn something, Let's have a discussion.
And I think everybody, especially me.
I can think back to the classes where I learned the most were ones where we did almost no busy work, very few essays. We just sit there and talked. And so I still think about my favorite professor. Ever, I don't remember any of the assessments. All I remember is sitting there and having my mind blown by this guy who is just lobbing like intellectual bombs at us.
And man, I've never thought about something like that. Yeah, and it still sticks with me, you know, to this day.
Yeah, I mean personally, I was like really good at the road like memories.
That's not necessarily a good thing though, I yeah, right, But yeah, you're.
One hundred percent correct. The courses I.
Remember and the things that I actually like retain from college had nothing to do with any of that. And I do think that there is a possibility that CHAT, GPT and other you know AI sort of forces a rethink of education in a way that could be revitalizing and could ultimately be beneficial. But this also to me, just shows, you know, now, it's disrupting the cheating industry, the multi billion dollar cheating industry a parent.
It shows you how quick the uptake is.
It shows you how many people have already figured out ways to work this into their life to do whatever it is that they needed to be done. And you know, it's clabboring this CHEG, but that's not the only company that is already anticipating that there are going to be huge impacts from this technology.
And that's the other piece of it.
I mean, we talked about the warnings, some of them quite dire, some of them quite terrifying, of what this AI could mean for all of humanity.
There's also a lot of.
Concern about what it could mean just in terms of employment and social disruption and how many millions of jobs could potentially be lost. And I know the cope is always like, oh, well, people just use AI to help enhance the work that they're doing, maybe in some instances, but there's no doubt about it that that level of intelligent and ability to have automation could crush a lot of industries, could crush a lot of white collar work, which is ironic because a lot of the concern was
about more blue collar or even service sector work. Now the real threat is in any sort of white collar industry where you know, an AI could at least make the first pass for paralegals, accountants, all sorts of things that could be directly impacted by this. And again not in the like long off distant future. I'm talking like right now, very very soon, imminent, already happening.
Yep, keep it in mind, folks, Like just it's just so funny too that the very first industry that chat GPT appears to have nuked is effectively for the privatized cheating program, which, look, you know, you never you never know where these disruptions will come. And I think it's the first shoe to drop of many personally, Again, I think it's a good thing.
It's not really you know, no offense to check.
It's more about the system that cheg was architected to try and help. It was all crap in the first place. So like, let's get to the point where you're just learning how to think. That's probably the most important thing you can learn in college if you're in liberal arts on the mass and engineering. Now quote that's actually completely different. But even there a lot of the road memorization quizzes and all of that. If you're cheating on it, then
are you really learning what you're supposed to anyway? There's got to be a better way. I've always thought that, you know, both my parents and education. A lot of people have long been frustrated by curriculum and bureaucracy and all of the different ways that we got to where we are, and this is their opportunity to just be like enough, let's start something new.
So I really hope that we get there.
We will keep watching it because I think this is one thing that could profoundly impact our entire society and civilization.
So keep our eye on it closely.
All right, let's talk about Ronda Santis was traveling overseas.
We've brought you a little bit of that.
And you know, it's funny because originally the media was really they were very bullish on Rondo Santis. Conservative media was really excited about Rondo Santis, really sort of propping them up. We know, Rupert Murdoch over at Fox News and with his whole empire told Ronda Santis like, we're going to be all in for you guys. The trip did not appear to go too well for him. Now, I want to say these are headlines that were compiled
by a Trump operative. However, I can confirm from my own perusal of the news that the coverage of his overseas trip was almost I don't know if I saw a single positive report from it. It's hard to think of one. So put this up on the screen. This is a compilation of some of the headlines that that the Trump campaign is flagging about his trip overseas. Politico
says ron de tedious DeSantis underwhelms Britain's business chiefs. The Independent says Ronda Santis critics gloat over brutal reviews of his UK trip, horrendous, low wattage board NBC News, I think he's in trouble. Growing number of Ronda Santis donors and allies hope for a shakeup Newsweek, Ronda Santis presidential ambitions endure another bumpy week role call. What is Rond de Santis?
The Doing.
Intelligencer all of Ronda Santis' crimes against good etiquette. I'm sure Sagaid be very interested in that.
One media I watched Ronda Santis loses his shit yelling a reporter over torchgations. We're going to show you that one.
Rishie Sunak avoids Ronda Santis on his UK visit. The list goes on Republican mega donor withdraws support. Watch DeSantis does that weird bubblehead thing. Jason Miller to Newsmac DeSantis running into a buzzsaw right now. Roonda Santis likes the killer spirit. After stumbles at home, he had a broad defined his footing. That's probably the most like even handed one that was from the New York Times. Ron de
Santis just lest another donor. Trump toss de Santis by forty six points Fox News poll, Trump still top twenty twenty four Republican preference. DeSantis is slipping, so not exactly what he was hoping for from his big, you know, very intentional international trip where he wanted to portray himself as a statesman. Many aspiring presidential candidates will do this
sort of thing. It's the idea is that it's going to help voters imagine you in that role as being commander in chief and meeting with foreign leaders and dignitaries.
Et cetera. If that was the goal. I don't think that this.
Worked out for him too well, No, I don't think so. I also think it's a stupid custom. You know, people always do. Like Romney went to London, remember that, and he pissed off the Brits during the London Olympics.
Oh, I vaguely remember that.
Yeah, Obama went to I think it was Munich or Berlin maybe, And anyway, so he went to Berlin and everyone's like, oh my, you know, a bunch of Germans showed up, and he's.
Like, wow, the world loves Obama.
It turns out that that's not actually any important metric in terms of being president. The custom probably dates back to Nixon, the idea that Nixon was like this elder statesman. That's where people get the idea that should come from. I personally don't think it really matters at all. I'm not saying global experience doesn't matter, but in terms of electability, which.
Is that, I can imagine a case being made that the Obama trip actually did help him, because I mean he was, you know, his junior seminary like spent three minutes in the Senate, and his whole appeal, especially within the Democratic primary but also in the general election, was very foreign policy based, you know, criticizing both Hillary Clint them then ultimately John McCain for the I Rock War.
So could I could see in that instance how it.
May have been beneficial for him, and I'm sure I don't remember specifically. I'm sure he got glowing media coverage for it as well, so that I can imagine how that sort of burnished his credentials. But if that was the goal for Ron DeSantis, he he clearly didn't.
Achieve it absolutely also as a reference, and this is the thing I keep coming away with Desantas Desanti's the biggest news that he made when he was in Japan for his trip was having his bizarre, weird bobblehead response whenever he was asked about the polls Visa v.
Trump.
What that actually just showed to me is I'm like, dude, you don't really seem to do well under pressure. Same thing here. So the Guantanamo allegations around DeSantis have been flying around for a while. Who knows whether they're true or not. You know, like, actually, to Desanta's credit, he's like, this is coming from a detainee.
You think they wouldn't want to make news. Maybe maybe not.
We know that he served there at least for some time. The thing is, though, is wouldn't you be prepared for the question? And from what comes in this response, I think what you're going to see is I think he's been dealing with the C league for a long time, and if he were to ever become president, this would be the easiest question.
You would ever get.
And clearly he gets flustered and he doesn't handle the pressure all that.
Well, let's take a listen to his response.
No, no, not all that's bs now totally who said that? How would they know me? Okay, think about that. Do you honestly believe that's credible? So this is twenty two thousand and six, I'm a junior officer. Do you honestly think that they would have remembered me from Adam?
Of course not.
They're just trying to get into the news because they know people like you will consume it because it fits your preordained narrative that you're trying to spend focus.
On the fact.
What do you think, Cristel? I mean, I could see how some right wing accounts might have spend.
That was like yeah, they were like, oh we own I didn't see it. I sound to get pretty flustered.
The thing is with Trump is Trump had a remarkable ability to laugh at them, and then if they.
Were really going to push it, he would be like excuse me, excuse me, and really own them.
I watched it happen several times. It seems insecure just to me because I think it comes out guns blazing out of the gate. He doesn't never try to disarm sometimes with humor, which is really just an underlying confidence issue.
I think whenever you're dealing.
With this, Yeah, he's got thin skin and he gets ruffled basily, and that's what it looks like to me, and you know, never let them see you sweat. And clearly on this trip he had two instances at least where people with you know, pretty obvious questions things have been floating around the press, his poll numbers, in particular, where he gets he reacts emotionally, and that's not something you ever want to do.
I mean, really, that's a good lesson.
Like in life, you want to keep control of your emotion so that you are playing on your own ground and letting people control you and get under your skin. To that regard, I do think the substance here matters though, because DeSantis. We will never know exactly what DeSantis was involved in the allegation, so that he was involved in torture and force feeding in particular of prisoners that he
was at least there viewing this. There were multiple detainees, which I'll remind you the overwhelming majority of Guantanamo Bay detainees were never charged with anything. Many of them were just swept up deemed enemy combatants, and they never brought them to any sort of trial because they couldn't actually find charges that would stick. So important to keep that
in mind in terms of who the detainees are. There were quite a large number who said they were called his face being present at least while they were being force fed, and he was there at a time that was really the worst.
Let's put this up on the screen. From Miami Herald.
There's been multiple reports about you know what involvement he had at Guantanamo.
This is Miami Harold.
Their headline is very intimate knowledge what Ron DeSantis saw while serving at Guantanamo. One of the things that they point out the time period when he was serving there was one of the most tumultuous and most truly horrifying in the history of Guantama, which is really saying a lot. You had deaths of three detainees during that time, You had clashes with guards rolling the facility, you had restraint chairs introduced during that time, during the height of a
massive hunger strike, facilitating the force feeding of prisoners. As I said, this wasn't just like one detainee, that's how they were called him. It was a fairly significant number. Nobody has been able to fully confirm that. I don't think there's any doubt that he would have been well aware of all of these things that were going on while he was there as a JAG officer at the facility.
And then the most important piece is I think he came away from that experience, you know, seeing the torture, or at least being aware of the torture and the deaths and the clashes and the totally you know, unconstitutional and unconscionable treatment of these quote unquote enemy combatants, this fake designation and all of those horrors, and he came away and was a very strong and defender of it.
I think that's important in terms of who he is, what his judgment is, his view of the world, his view of our responsibilities internationally in the way that we should treat human beings. So regardless of whatever his involvement technically was, to me, the most important point is that he was there during the height of some of the worst abuses, and he came away and was incredibly aggressive and strident and defending it well.
And that's another point about strength, where if you were going to answer that question, and if you still believe that, you're like, listen, I did my job while I was there. I never tortured anybody. This is fake news. Next question. It's one of those where again you're just coming at it from a position where it seems to me that he either appears like he wants to try and always like own the person but doesn't necessarily do it, or it comes from a position of genuinely being rattled by it.
Either.
I think both are lack of self confidence, which is very important if you're going to run for Yeah.
So there you go.
On seven hundred and eighty individuals that went through Guantanamo since it opened, only thirty two remained there. Eleven of those have been charged with a crime. I mean, this is a stain on America. It's you know, a stain on every administration since the Bush administration, including the Bush administration, that they have not been able to close down this facility.
And you know, I find it a real stain on his judgment and his career that he continued to defend what he saw up close and personal.
The stupidest thing about Guantanamo. Let me just say this.
Yeah, so, the reason you can't charge these guys with the crime, even though in some cases they are dead to right s guilty, is because they were tortured and we have violated their PRIs If we ever put them on trial, they could get off, but we couldn't use any of the information that we gleaned against them in a court of law, which is what FBI agents who were there at the time said. They said, don't do this because by doing this, we can't prosecute them.
And now it's in admissible.
And now you have a case where you literally have the nine to eleven masterminds sitting in a cell and you can't charge them in the US Corps and going through some BS military tribunal child which doesn't make any sense, even though, of course, if you're going to prosecute me, he has protections under US law. It was all foreseen
at the time in two thousand and one. So you can thank George W. Bush and Dick Cheney and all the other idiots who said that there was clue woke, clear and present danger, and it's twenty twenty three and we still have a goddamn mess on our hands.
So thank you, George W.
Bush.
That's right for doing this.
At the same time, we have new developments in terms of the fight between ron De Santis and Disney. We told you before, so you guys probably remember the backstory here. Disney came out against the so called don't say gay Bill put on a statement. Ronda Santis and his allies reacted against that. This was, you know, him standing up to the woke corporation. And I think this thing is
escalated way beyond what he would have liked. Like the rest of the country has moved on, and he's still stuck now in this battle against a multinational, gigantic behemoth company that happens to be incredibly central to the economy in Florida. So he's picked a very large fight here. I do want to say though, there was an interesting analysis.
Disney is now suing DeSantis because they before this ready Creak Improvement Board that they had control over before this got turned over to Desanta's allies, they really kind of worked him over. They put out their notice that they were going to have a meeting. They did it twice,
which is what you're required to do under law. They had this meaning and the last act of the board before the Desanta's allies took it over, was to hand control effectively to Disney and sign this gigantic development deal. Now the DeSantis people have come in, they're saying no, no, no, we're going to roll back this deal. There's some legislation that has involved as well, and so Disney is saying, all right, we're going to sue you.
Now.
I did an monologue before saying basically, listen between Trump attacking DeSantis, DeSantis on this mess that he's created, Disney being a gigantic corporation, Like, there's really no one to root for here in my personal opinion, But the way that Disney crafted this lawsuit is something we should actually take a close look at. And some of the reporting
on is kind of troubling. And you shouldn't if if you're you know, on the political left, or if you're just concerned about corporate power, you shouldn't necessarily be cheering for Disney to succeed in this lawsuit. Put this analysis up from Slate, which is a sort of left liberal publication.
Joseph Stern, he's probably as big a lib as it gets on these issues.
I just want people to know, Yes, it's important to know who this person is and the perspective they're coming from. And he says why I can't root for Disney's lawsuit against Ronda Santis. I'm going to read you some of these specifics here, but the TLDR is that they have taken this very expansionist view that would hand a lot of power to states to quash and to courts to
quash any sort of like labor law regulations. This is going This is a throwback to the one of the worst eras of the Supreme Court, if not the worst era of the Supreme Court, the Lochner era, where they used contract law to try to quash things like minimum wage legislation or you know, minimum work day legislation, things that were beneficial for labor. They tried to say, no, no, no. The contract clause in the Constitution says that you can't have any of these sort of regulations coming in to
protect labor. Now, this was has been left aside in terms of jurisprudence for more than one hundred years. That Disney is reaching back to, and a lot of other plaintiffs are reaching back to because they see the incredibly pro corporation right word swing of the court and they are hoping to bring back some of this Lochner era jurisprudence.
So let me read you a little bit of the analysis here.
They say this case is more about contract law than free expression, and by invoking the Constitution's contracts clause and leaning on it so happily, Disney is playing with fire. There's a reason this provisionist at war bond for nearly a century. Interpreted broadly, it could give courts immense power
to help corporations and employers escape regulation. The federal judiciary should not be handed another open ended invitation halt progress at the behest of the scrupulous and powerful, which free speech gestures aside.
Is what this is.
Goes on to discuss how this became what he describes as a tool of mischief during the Lochner Area era. That was a period from the eighteen nineties to the thirties when the Supreme Court routinely invalidated health, safety, and economic regulations. The clause fit neatly into the Court's conception of a constitutional liberty of contract that sharply limited state
oversight of the marketplace. During this period, For instance, Scotis repeatedly used the contract's clause to preserve private monopolies over the water supply, preventing local governments from constructing their own waterworks. Struck down a Kansas law enacted during a financial panic that let mortgage holders state in their homes for several
months after foreclosure. And as I said before, this is now being used, you know, to try to get around eviction moratorium, to try to get around rent stabilization laws, to try to get around wage increases. They're again arguing that this violates the contract's clause, and this Disney suit fits into that matrix. This is they're not arguing on
free speech grounds. They're not even just arguing on like you know, this was wrongly rolled back, this development deal that we put into place in which was rightfully signed to law. They're not arguing any of that. They're going for this much larger, much broader, potentially much wider implications contracts clause argument.
That's why though, that it was always important to take a step back, and you know, people were like, I want to own desantists by supporting Disney and vice versa. Yeah again, whatever you think about the merits, here's what was happening down there. Disney has was running not just
a magic kingdom but a literal kingdom in Florida. They had the ability to like tax themselves, the police force they were literally had almost total control over this town, and it was effectively like a sovereign area akin to almost like a tribal nation inside the United States, except it was a multi billion dollar corporation. Now you need
to ask yourself, are you okay with that? Because the previous times in American history when we had that were things like Henry Ford's factory, you know town, which was so wonderful because you could pay your rent to Henry Ford using your forward bucks.
And you had mining, yeah, coal.
Mining towns that then followed the Ford model, and you basically had people in quasi you know, indentured servitude and or slavery up until really like the nineteen twenties and thirties, whenever people rejected this in the height of the Great Depression. So the point is, like, do you want some sort of legal architecture to be allowed to exist? This also comes back to the crux of the Disney lawsuit. In the brief, they say Disney's First Amendment rights were violated.
This comes from you have to take a step back and say, well, hold on a second, does Disney do Disney employees.
Have a right to freedom of speech? Absolutely?
Does Disney the corporation have a right to free speech?
In my opinion, no, I don't think.
Any corporation should have a right to free speech. All the corporations are people. I don't think that they should be treated in any way in the same law. And that is actually where the crux of all this comes down to. It's about power, and it's about the fact
that you can even listen. I'd support people's freedom of expression and a speech, but I just used a keyword there, which is people, not corporation, because then it comes down to the idea that we the people can't tell corporations what they can and cannot do, which is the very basics of how civil governments govern commerce itself.
Well, there's no doubt the Supreme Court disagrees with you, I know that and with me on that. And that's one of the ironies here is that the conservative project that Ron DeSantis has long been a part of has stacked the judiciary with judges who look very favorably on Disney and other gigantic corporations having mass amounts of power and having you know, complete personhood rights and complete free
speech rights, et cetera. So that makes it less likely that DeSantis is going to succeed here because again, and this is the judicial picks have always been sold to the conservative base based on social issues.
But as we've talked about.
Before, I mean, a lot of the real game is about corporate power and about curbing labor power. And so that's the court system that this goes into. The last piece of this is this is the latest development. There is a countersuit now that Red Creek Improvement Board that used to be stacked with Disney people and is now stacked with Desanti's people. They are countersuing Disney. Put us up on the screen from CNN they say DeSantis aligned
board votes to sue Disney. The chair of this now called Central Florida Tourism Oversight District Board of Supervisors that's the new name for this thing, says, since Disney sued us, yes, we didn't sue Disney. Disney sued us we have no choice now but to respond, Yes, we will seek justice
in our own backyard. So that's the very latest. I have no idea how the law will, how this wall play out in terms of the legal you know, decisions that are likely to come down here, but I think these are all important pieces to keep in mind.
Yes, that's right. So let's talk a little bit about First Republic Bank.
Yeah, so yesterday we brought you the pretty shocking news that we were living through the second largest bank failure in history. So that's kind of a big deal, and we now can bring you some war numbers about just how significant the turmoil in the banking sector of these past few months has really been. Put this up on the screen from the New York Times. They crunched the numbers and they found that the failed banks this year were actually bigger than twenty five that crumbled back in
two thousand and eight. And you can see it's pretty close if you're looking at this bar chart. They just these three banks that just failed just barely, you know, managed to surpass the twenty five that failed last time around.
They said the three banks held a total of five hundred and thirty two billion in assets that's more than the five hundred and twenty six billion when adjusted for inflation, held by the twenty five banks that collapse in two thousand and eight at the height of the global financial crisis.
You will recall the implosion of Washington Mutual that year as well as the investment banks Lehman Brothers bear Stearns was followed by failers they are on the banking system, and between twenty eight and twenty fifteen there were actually more than five hundred federally insured banks that failed. Most of them were small or mid sized regional banks, and
most of them were absorbed into other institutions. And Washington Mutual itself, which was heavily involved in risky mortgages and became the largest bank to fail in history, was sold to JP Morgan Chase, just as First Republic has now been sold to JP Morgan Chase, which has made this bank an absolute giant. It is now by far one of the largest banks in the entire world. Jamie Diamond, as we discussed yesterday, is like one of the most.
Powerful people in the world now.
Ever since we had the two thousand and eight crash, banks have only gotten bigger and bigger and bigger. I think the number I saw is that JP Morgan Chase is now twice a size that it was.
Before the crash happened.
So the whole idea of we're going to end too big to fail, et cetera didn't work out that.
Well, yeah, too big to fail is now policy. I mean, I said this yesterday, but having the numbers is nuts. JP Morgan three point two trillion, Bank of America two point four two trillion, City Bank one point seven seven trillion,
Wells Fargo one point seven two trillion. The drop off from the big four down to the US bank is over a billion dollars from their point you get to five hundred billion, then PNC Bank is five hundred billion, Trust Bank five forty six, Goldman for eighty seven, Capital one four fifty three, and TD Bank three eighty seven. So the reality is is exponential the growth whenever it
comes to the biggest banks in the US. And in fact, we really just have four banks, you know, in this in this country that can control the vast majority of assets, which means that if any one of those four goes down, then you know you're you're looking at two thousand and eight on steroids and I just think that the headline there is something that we should all really internalize. The three failed banks bigger than the twenty five that crumbled in two thousand and eight. Now we're not saying that
this is two thousand and eight. It's not the same level of contagion, it's not the same level of systemic risk to the banking system. It's got not going to have the same cascading effects. What we are showing you, though, is that the precarity within the economy is probably bigger than people think, and that we could just be one or two events away from a possible two thousand and
eight environment. And even if we're not the system that we have right now, if eight ever hits again, and do you really believe the regulators are totally doing their jobs? And if one of these big four goes down, one of these you know, the Bank of America's, the JP, Morgan Jays, the City Bank, Wells Fargo. We have four guys who are charged those which is one of them twenty five percent makes a decision one in four chance
you could crash the entire US economy. You could literally and it would be bigger than two thousand in terms of the bailouts that would need to be done and in terms of the risk that it poses to all of us.
Yeah, no, that's right.
There were a couple other pieces we wanted to bring you here. So part of the issue that we discussed extensively in the wake of Silicon Valley Bank collapsing is you know, what should be the FDIC and deposit insurance levels? Two hundred and fifty K is in theory what it was. But when Silicon Valley Bank collapsed, instantly the government came in and said no, no, no, we're actually going to
backstop all deposits. So that raised a host of questions about, Okay, while you're doing that for everybody, what does that mean? Do we need to adjust the system going forward? And put this next piece up on the screen. The FDIC just issued their own report. This was written up in American Banker, a publication I frankly did not know exist but do now. They say, FDIC recommends higher deposit insurance
for business accounts. So they considered three different approaches. One is unlimited deposit insurance, basically make what they did at Silicon Valley Bank, make that the law of the land, and have premium increases to reflect the fact that actually now all deposits and all values are going to be backstopped by the federal government. They said that particular idea could be a bad idea because it could encourage sort of risky behavior on the part of banks and depositors,
et cetera. They were worried about moral hazard there. I'm sure also the banks don't really want to pay those premiums that would you create a fund large enough to be able to backstop the entire deposits of the entire country. So that was one idea that they put off the table. The other is to keep the status quot two hundred and fifty k for everybody, and it is what it is. They felt that because of some of the challenges that we saw with Silicon Valley Bank, that that doesn't adequately
address run risk. So they felt that that was not the best way to go. So the third way that they proposed here is targeting deposit insurance for business accounts, so that you could have greater coverage for business accounts without all the moral hazard. Unlimited insurance introduces yielding what they describe as substantial financial stability benefits relative to their costs.
So they're trying to say, okay, so for most regular depositors, it'll stay at two hundred and fifty K. For business accounts, they would presumably have to pay some sort of surcharge and they would have a higher level, not unlimited, but a higher level of deposit threshold that would be covered.
Yeah, look, I definitely support that.
You know what the problem is though, is that when you give somebody something for free, then why are they going to pay for it?
So imagine that like we came out and.
Say it don't want point all I fd I see things are benefit and everyone's like okay, cool. So they got the benefit and they didn't have to pay for it, so why would they pay for it? And even if they do pay for it, we will all pay for it. They're the ones who are going to raise the rates
because of their risky behavior. You know, there should be a better system that is put in place where the cost is not put on to the consumer or the small business Crystal somebody like you're in my account instead of something like the banks and their profits that they are allowed to take in the first place.
So I think this whole system is totally.
Backwards for who gets to pay and who doesn't, and it's just still highlights to me, like how unfair the entire system really is.
Through all of that. You know.
Also, though, in terms of the Federal Reserve, at least some questions are being asked.
Put this up there on the screen.
Jerome Powell actually could face more opposition as these FED choices are getting tougher. The Biden administration is set to nominate a new person to the Overall Governance Board Crystal, And at the very least policymakers are asking questions about the interest rates.
Yeah, now that their banker buddies are interested, so they're starting to think.
Like maybe we've done enough. Great high point.
Anyway, at least they are doing something. But they're not doing something because any of us are suffering. It's because they're bank boys, are Yeah.
And they're still expecting to their meeting this week. The expectation is very much they'll move forward with a twenty five basis point hike. And then after that you have really split views. You have some what's called, you know, hawks who want to continue hiking rates at a very aggressive clip given the fact that inflation continues to be
relatively high. Although the pace has come down somewhat, and then you have some doves who are like, you know, we've already kind of broken some pretty significant things in the economy by lifting the rates, because the interest rate risk was at the core of the failure of all three of these very significant sized banks. So they're saying, listen, we already broke some stuff. Maybe we should cool it here and wait for things to settle and see how it's all going. So that will be a fight that's
playing out at the FED over the coming months. At the same time, you know, I think one of the important stories coming out of the handling of First Republic's failure is once again JP Morgan Chase getting much much larger and becoming an absolute giant. It has been on this path for quite some time. This makes Jamie Diamond incredibly significantly important. Financial Times had a good report on this. They note put this up on the screen. They note
that all deposits were taken over by JP Morgan. That means the US government did not have to declared the bank a systemic risk to protect those larger deposits over two under fifty k JP Morgan, though, they secured a loss sharing agreement, so they capture whatever upside there is, but they have some law sharing agreement to avoid the downside. They describe that as a crucial sweetener for the buyer.
And although top Biden administration officials played a less prominent role in the negotiations than in the failure of Silicon Valley Bank, the deal came together after heated discussions between Washington and Wall Street. And they note that Diamond had a direct line to Biden through his contacts in Washington, and I would wager a guest that Jamie Diamond always has a direct line to Joe Biden, because he is in some ways as powerful or more so than the
President of the United States. At this point, they also talk They quote Ian Katz at Capital Alpha Partners who warns that as the dust settles, there may be increasing political opposition to this deal. Why because in ordinary times regulators never would have approved JP Morgan Chase buying a bank of the size of First Republic because they are already over the limit of having more than ten percent of all of American deposits residing with their bank. They
were already over that limit. So if they had just come and we're going to buy First Republic regulators would have said, no way, you're already over the limit.
We're not doing it. And so they say they never would.
Have received regulatory approval to purchase a healthy bank of that size. They will now get bigger due to their role as savior of last resort. I mean, we have effectively made JP Morgan Chase like a quasi governmental institution and handing them perks that are involved with them looking for them to clean up messes that are made in the banking system in other places. And that is an extraordinary role that they have been put in. Jamie Diamond struck a defiant tone in reaction to all of this.
They write, he said, we have capabilities to help our clients, who happen to be cities, schools, states, hospitals, to governments. We bank countries, and we bank the IMF, we bank the World Bank. You need large, successful banks, and anyone who thinks that would be good for the US to not have that should call me directly. I guess we need to get his phone number there.
Yeah, yeah, please catch out Jamie. And look, we have a visualization. Go ahead and put this up there on the screen that people can look at. Just look at this. I mean, this is what we're talking about here.
This is a note.
This is before this acquisition, which is going to add another additional trillion dollars roughly to this number that you see here exactly.
So, now JP Morgan is not only the biggest bank in America, it is bigger by orders of magnitude than the previous largest bank, which is Bank of America, which is already huge at two point four trillion, which is also bigger than City Group at one point seven. Like I was saying about earlier, put those four together, we're talking about the vast majority of the US economy in the hands of these four banks.
It's been a total failure of too big to fail.
The entire two thousand and eight thesis that the vast majority of Americans came away with is We're never going to lie this happen again, because we will never be forced to have bailouts. And instead, we have actually made it more likely that if we ever do face a risk, that we will have to go in and bail these banks, which is what a what a I think, you know, travel back in time fifteen years ago, yeah, and try and tell them that that's how everything was going to work.
Out.
They would have told you that you were nuts that were never going to let that happen.
But we did let it happen, and we actually made it worse, you know, in many many respects, which I think is really sad. You know, to consider about how much populous energy came out from two thousand and eight Occupy Wall Street and so much of that, and you know, really what it ended up with is a more precarious financial system than ever.
Just final point to underscore this. Put this last piece up on the screen. This was from Forbes. They write, with first Republic takeover JP Morgan is America's most globally systemically important bank. Their acquisition makes it that it has an asset size now of over four point two trillion. You know that dwarfs now its next competitor Bank of America. It will now rank number five, after four Chinese globally systemically important banks, and it's now more than twice the
size it was in two thousand and six. So you know, this author appines clearly the too big to fail problem in the US not only alive and well now an even bigger problem for the financial industry in the American government. Some analysts have stated, the first Republic bank failure is idiosyncratic. Three banks have failed in the US in less than two months. They are amongst the largest bank failures in
US history. This is serious. And the last thing that I'll say for everybody to reflect on is the fact that you know this transaction, which once again makes JP Morgan Chase basically a quasi governmental institution, because Lord knows, we are not letting that ship go under no way, and the US government is backstopping any potential risk and losses here of JP Morgan Chase. This is all done over a weekend. It's done very quickly. There is no
public input or democratic ability to dissent. And that's the world that we are living in.
Yeah Morgan, Joe Jamie, I mean, is now basically the new Andrew Mellon. If you guys, we don't have enough time today for me to go into it, but you should go and look him up. He was both one of the richest men in the country and the banker
Secretary of the Treasury of the United States. He eventually went to prison, which is kind of inspiring, but an accountability well, after the Great Depression, we kind of woke up to what was going on there, But in the twenties he was basically a god king here in the US, almost exactly one hundred years ago, coincidentally, So who knows, maybe history will beat itself.
We also have our eye on tomorrow as World Press Freedom Day, and there are some new numbers ount that reveal the way the American people feel about our free press here.
In the US.
And none of these numbers are going to surprise you, but it's always interesting to dig into the specifics. Let's put this first piece up on the screen. This is from the AP and the question here is is the news media doing more to increase political divisions in the US? Decrease political divisions or does it not have any impact? And seventy four percent of America say, of Americans say that it increases divisions, I want to meet this six
percent that those decreases divisions. Eighteen percent say it has no impact. So this is an overwhelming indictment of the press and of what they're doing. You know, it gets to the core of Matt Tayeb's book on this subject that effectively, the media's whole job and how they fill a twenty four hour news cycle now is to convince you that your fellow American is the gravest threat to you and your security and your way of life.
And people obviously hear scenes of the game.
Yeah, I'm glad that they do. And we've always known this.
I say, I've ha told this story before, but I met a guy once who made many billions of dollars, and he said, always bet on charts. And whenever I think about the success of this show, and not just this show, so many of the other independent shows that are out there, and you put them all together, and the viewership is many orders of magnitude, you know, combined. Then let's say the total three cable news media. It comes back to this chart. You know, always bet on
trust in the mainstream media. And then the fact is is that the vast majority of Americans not only fault, not only don't like the news, they actively blame the news for dividing the nation. And I think everyone in this country can have some sort of personal experience for both right and left to think back to think about a grandma, one of those people who's got a TV installed in the kitchen just so they can watch Fox all day.
I wish I was joking.
There are a lot more people then you might think, who have literally done that, who can recite to you almost word for word, you know, what's whatever the scandal
of the day is. But then also think about, you know, somebody screaming in somebody's face over holding up a sign for somebody that they don't disagree with, or going out of their way to prompt a public confrontation over something which again is fueled almost entirely by the news media and by social media or any of those things that has surfaced up to them, And just think like, is any of this necessary?
Because I don't think it is.
And one of the things that I think we can come away with is that if you do talk to one another, most people on a very very basic level, are not the caricatures that they see. Most are far more multifaceted and nuanced and understanding than anybody would ever think than if they watch the news where they currently are. And I do think it is at least hardening, even though many people are still locked into the system that most people do at the very least understand that. Now
I can understand that. I think most humans can both understand that and be victim to it. So try to minimize the victimization as much as possible and instead have that understanding as you go through your life.
Well, because I also think there's a real tendency of people to see media as a problem, but not their particular media.
Yeah. It's like when people hate Congress, but then they like their congressmen.
Yeah, yeah, yeah, exactly.
So it's like, if you're an MSNBC watcher, you're like, well, they're not the problem, you know, Fox News. And if you're a Fox News while you're like, well, the soft Foxes in the issue. Those morons over it, like, you know, the MSNBC. And it also it's always fun to me when when they portray themselves as not being mainstream media, when it's like, you are the largest cable news network, Like whatever you were when you were a scrubby upstar,
you were not that anymore. You were definitely part of the mainstream press of America.
You won't be surprised to learn.
Also, Republicans had a less favorable view of the media, although there were a lot of negative views of the media to be had on all partisan identifications. Put this next piece up on the screen. So here the question is, is the news media hurting democracy sixty one percent of Republicans said yes, twenty three percent of Democrats said yes, thirty six percent of independence.
Now, there has been a.
I think ever in my entire life, there's always been a trend of Republicans being more skeptical of the media and feeling like their views and perspectives and cultural values weren't reflected in the mainstream press. But I also don't think there's any doubt about the fact that that has escalated in the Trump years, and that, you know, you also now have Democrats that feel similarly frustrated with the press.
There are a lot of Democrats who've feel like the news media propped up Donald Trump for ratings back in twenty sixteen. They have all sorts of issues with the press as well. So so you do have those numbers inching up. You also have overwhelming concern about quote unquote misinformation. I suspect that there's a lot of different definitions and understandings of what misinformation might be.
But put this up on.
The screen, ninety percent saying that misinformation is a problem, only ten percent saying that it is not a problem.
I agree with that ninety percent.
When you look at you know, you look at Russia Gate hoax, for example, you look over at po Definition, Yeah it looks so you look over at Fox News. That's the way they clearly knew stop the steal was alive, but they went forward with like pushing on their network anyway. So I agree misinformation is a problem, but I doubt that I agree with everything that's that ninety percent defines as misinformation would be my guest exactly.
It's like when you ask Republicans democrats is democracy a problem, and you say they they all say yes, and they go who's the problem, and they say.
Democrats pointed to each other.
A whole lot, we're talking past each other. The next one, too, is important. Put this up there around social media. When you see a news story on social media, you quote expected to be accurate, only sixty six percent say yes, thirty three percent say that's inaccurate.
We got to get that an accurate number up.
Yeah, for sure, especially given ai that we've been discussing, like, you all need to get a whole lot more skeptical immediately right now.
So look, I think what you can really take away is Americans are very unhappy with the news media. They're unhappy for variety of different reasons, but on happiness is opportunity.
For everybody who's involved.
That's part of what we're trying to do here, That's part of what a lot of people are trying to do all over the internet, and overall, I think that's a good thing because what it does is fill in avoid that exists and that has been artificially almost propped up, and any other business which wasn't as fake this long ago would have died now. Unfortunately, you know, for a variety of cultural and economic reasons, it hasn't been. But that just makes the fight, I think even more important.
Considering that the news and large is the medium through most which people experience civic life and politics. I don't think it should be that way, but it is, and so that just makes their importance even higher whenever it comes to policy and the way that people interact with each other on a day to day basis.
Sometimes people to see people like.
In traffic who have bumper stickers, so like, if you're a liberal, like, here's the birth and I just want to be like, dude, like what compelled you to go out and to buy that sticker and to peel it off and put it on your car and have some smug or you know, vice versa opposite. And I'm always just like, what's going on in your life where you thought that this is like an appropriate thing to do and behave as an adult.
It's very odd.
It doesn't come from it's not a natural thing. It's one of those where that came from somewhere, and I don't think it's a good thing.
Yeah, like you're putting a bumper sticker on your car. That's like, I hate half of the country, So why why are you doing this? Doesn't seem very healthy for you.
Just drive the.
Car, man, go to work, you know, drive something and you enjoy or you know, or lady, I see, you should see some of these woke ladies that I live around. Some of the sciences these people have in their windows crack you up. Anyway, I think it's important for people to know it's not a natural human thing. It comes from somewhere, and we can change it. And it hasn't always been this way.
So that's a good thing. Yeah, inspiring. Let's go to the next one.
Two important stories first about Tucker, but also about Vice News and some breaking news.
I guess we can say about what's going on over there.
So, with respect to Tucker, a video has now come out of being leaked to media matter. There's lots of speculation around who leaked this video. Was it somebody who works at Fox? Most likely was the Fox management to try and make him look bad. I find it very humorous. Basically, what you're seeing here is a behind the scenes video where producers are telling Tucker he has to wear a
sweater during an interview with Andrew Tait. Tucker doesn't want to wear the sweater because it's going to appear on his primetime show. And I think this is a great view for a couple of things. Christy, you and I have worked with such producers and others. This is a good view.
I want everybody to take away from this.
You can get paid twenty five million dollars, but when your check is signed by somebody else, you're still an employee. You're like inside of a system. Yeah, you're not the king, you know, or even the queen or what. You're not in charge in the way that you should be, and most people think that you are. You're inside of this apparatus. He's dissatisfied in this clip with Fox Nation. He's upset about the website. He's upset about, you know, the way that they're talking to him.
And Fox Nation is there like streaming plays.
They're streaming which form we have good luck to them, right.
And these streaming platforms there's no transparency around, so you have no idea how they're actually faring. And I think Tucker sort of gives up the game there.
He gives up the game on how well it's doing. It also really just gives up the game on you could be the number one star on cable news media.
But people are still telling those people what to do. Take a listen.
I don't want to be a slave to Fox Nation, which I don't think that if people watch anyway, we're gonna uh because I you know, I'm like a representative of the American media now speaking to an exile in Romania and welcome to him back into the brotherhood of journalists.
Yeah, it would help us out if he wore though, because we.
Asked him not to wear a suit like he was kind of about it.
So if you don't have to talk, is gonna be looking casual? That's is that?
Okay?
I I mean this is airing on the nighttime show and I wanted to look official.
I don't want it to be like bro talk and.
I and I, you know what I mean, give it.
The majority of it.
Like if we go like forty five minutes, it's gonna be Foxnation.
But nobody's gonna watch it on Foxination. Nobody watches Fox Nation because the site sucks. So I'd really like to just put the dump the whole thing on YouTube.
But anyway, that's just my view.
Uh, I'm just frustrated with Uh, it's hard to use that site.
I don't know why they're not fixing it.
It's driving insane and they're like making like lifetime movies, but they don't they don't work on the infrastructure of the site, like what. It's crazy, and it drives me crazy because it's like we're doing all this extra work and no one can find it. It's unbelievable. Actually we're
doing our part. We're like working like the animals to produce all this content, and the people in charge of it, whoever, that guy's whatever his name is, like they're ignoring the fact that the site doesn't work, and it's I think it's like a betrayal of our efforts.
That's how I feel so I of course I resent it.
Here's the worst part.
He ended up working, you know, and and that that tells you so much. It's like you work. When you work for somebody, they're telling you how to dress. Nobody tells us what to wear. I wear these suits because they like them. You wear what you like because you like it, because it's how you feel like it. That it's that, and think about that's the number one star and Cable. What are they telling the other people because
that how they talk down to everyone. And the arrogance too of that producer about you know, here's the thing who gives a shit what you what he wears? Does it matter at all? Like in any way, No, it's all fake. And the point that he makes too is also so great. All right, He's like, yeah, why does the site suck? Why are they making these idiot they're doing like a Bible study with Ainsley, But the site doesn't work.
And if his stuff isn't getting washed on Fox Nation, no one's stuff was getting watched on Fox station. Which why there's no way that Foxting has managed like this because this is too embarrassing, I think, so yeah, yeah, they don't want to reveal it and no one watches Fox Nation and that the website stucks, and then he's like, this is.
A waste of my time. No one is watching it here.
There's I think, one point in the conversation where he's like, I want to put the thing up on YouTube because then people.
Will actually watch it.
She's not an idiot, but I mean, yeah, to me, the piece that is so revelatory and not surprising having been in this industry, is like, yeah, you can be the number one rated host, you can you know, be
world famous, et cetera, et cetera. But if they want you to wear a sweater and wear freaking sweater, And if you don't think that applies to like putting Tucker aside, if you don't think that applies to all of these hosts and what they cover and how they cover it, and what they look like while they do it, and who they're nice to and who they're mean to, Like, you're a fool. And at the end of the day, they decided, you know, that Tucker was more trouble than
he's worth. I agree with that assessment, and they decided to terf them for a variety of reasons. But yeah, it's I guess the last thing to say about this is all of these networks know that their numbers are falling, they know their business model is fading. They know they've got like some sort of limited try. Well, you know, it'll drag out for a long time and they'll still have cultural relevance for.
A long time. I don't want to diminish that.
But they're all trying to figure out how do we make some sort of a digital plays so we can like get a younger audience and keep this thing going. And every single one of these efforts has been a catastrophe. Clearly, vhoccination is a catastrophe. Fox CNN Plus is a catastrophe. We don't know the numbers at Peacock, but it's obviously catastrophe as well because their behem, they don't know how
to create content that people want to see. They don't know how to create a platform that people want to engage with, and so they're just like dying a slow death by a thousand cuts.
Yeah, absolutely watch that clip.
And if you ever want to know why, we will never work for these people ever again. Yeah, why really a major animating thing. That's how it works behind the scenes, guys like they try and tell you what to do and some stupid ass segment and you're like, what do you do? What's wrong in your brain that you would even think that that is real? And that's up and down the chain, you know, for the entire industry. Let's go to the next one here, which is some stunning news.
That broke yesterday. Let's put it up there on the screen.
Vice is supposed said to be headed for bankruptcy. The company, once valued at five point seven billion dollars, is struggling to find a buyer this year, has an incredible amount of debt. The news comes immediately after they fired several people in their DC bureau and are cutting costs across the board. This is a company which raised money from Disney, which raised money from private equity in twenty seventeen, was
valued at a full five point seven end quote. By today most accounts it is worth only a tiny.
Fraction of that.
In the event of bankruptcy, their largest debtholder would end up controlling the company. They said that they're operating normally vices currently and what are trying to run an auction to sell the company over the next forty five day period, but clearly they are in dire, dire financial straits. So there are only two ways of this end. Somebody buys it for absolute pennies on the dollar. Very unlikely actually, because they have high cost their burn rate is high.
They've got the building in Williamsburg, They've got all these costs in terms of shows and other contracts that they signed up for.
They've got massive salaries or had.
Them at one point on the books, and this is really sad to me on a personal level. BuzzFeed, I'm gonna be honest, I thought it was hilarious whenever they went down. I thought it was funny with Goker went down.
Vice was.
It really inspired me to get into the business. They were some of the forefront pioneers on YouTube, developing of finding stories, telling them in a way that I and many people my age and you know, millions of people wanted to consume. I will absolutely never ever forget watching the Vice Guide to North Korea. I had never seen anything like it. I think that came out in two thousand and six or two thousand and seven. And then watching you know, some of their Libyan stuff like Buria.
Right along with Isis.
Yeah, I mean I remember that one too, the Syrian Civil War coverage.
Yeah, that they did.
It was incredible.
And look, I mean there's a lot of mistakes that were made there, ideology and business on top.
But it's sad. It's sad to watch it. But and some great stars were born out of vice.
It's hard to I mean, you can't forget. This thing was a giant. It was seen as the like sex gy media upstart. Everybody was all the traditional media outlets were like, how do we replicate this? What they're doing is astonishing, And part of the problem is the things that you're talking about that they did or like the isis ride along or whatever. No established network would do that because it's way too risky and nor should they honestly, because.
You're like really putting fear of risk.
And so that's the sort of thing that they couldn't really scale. And so yeah, they went down a sort of like typical like left liberal, more identity type of track in terms of their ideology. They became much less unique and I think much less provocative risk taking. And you know, it's also part of this broader shift that we're seeing where all of these outlets that were giants in the twenty tens.
It's over. It's just totally over. The amount of funding and cash that was.
Being thrown at BuzzFeed and Mike and Weiss and all of these companies, the valuations they were able to achieve, it was insane.
Yeah, and now you know.
The business the ideology has shifted, the business models have shifted, and so whatever they were doing at that point, now that you have ad revenue specifically right now, has really taken a hit. And this is part of the whole tech session conversation as well. All of these companies that were kind of struggling along that was it for them.
There's a great documentary. I might do a modeling on this, because I've never forgotten it. It came out in twenty eleven. I watched it at the time, and I watched it probably every few years since then. It's called Page One, and it's about the New York Times and specifically their media critic David Carr, as they're navigating the Internet at the time. This came out again twelve thirteen years ago.
Now there's a scene where Shane Smith is facing off against David Carr, and in it, David Carr was a media critic who is now dead, and Shane is basically super arrogant. He's like, we're doing what you people have never done before, Like we're going to the place we are in.
The new media. You're the old media.
All this sof and David is like, hey, we've had people in Africa since nineteen sixty like, shut up. Basically he tells me, shut the f up, actually curses in the video, and the arrogance that was exuding was correct if you're thinking about it. In the mind of Shane Smith at the time, He's like, I'm doing stuff you guys are never going to do.
I'm the new media. I'm taking over the Internet, all of this.
But at the end of the day, you know, twelve thirteen years later, the New York Times is frankly more profitable than ever before. They actually won, they beat Vice because they hired a lot of the people who we used to work at Vice who were any good on top of Box and others. And now Vice is on the verge of bankruptcy. There's a story there to be told about what went wrong for so many of these companies.
Fundamentally, I think it was business.
I think they got in league with the big, you know, the Hbos and all these other people of the world that got away from their roots.
They let ideology seep in.
They started building large buildings in downtown Brooklyn, which nobody asked for, and instead they they never played it safe. They tried to do a tech model of get big fast, and by doing that, they took on tech risk without any of the tech upside. It turns out we're all in the same media business, which is a game of inches. You have to kind of have to be brutal, you kind of have to be very risk averse, and you have to think ten fifteen, twenty one hundred years or so in the future.
You can't have a huge overhead of legacy media. That's just not going to You're not going to be able to do that in the digital age. And many of these companies really bet on the social media monetization, many of them that are originally on Facebook being huge. I mean Facebook has moved away. First of all, Facebook is like there's not much left content that does well they're
at all anymore. When it's it's hard to like, it's easy to forget that that used to be the place for Upworthy and Mike and all of this, like left liberal content was huge on the platform. They're moving away from politics all together. They changed their agroithm to really like screw you on monetization long ago. That took out some of these players, but I think now we're seeing also so with you know, Twitter is moribund. It's not nearly what it used to be already, and so that
is changing the underlying business dynamics as well. And Ben Smith, formerly a BuzzFeed, was talking to Ryan Over on his.
Podcast about the fact that.
You know, some of these it's it's like some of these throwback players are coming back. People are looking at like building out their homepage again, which is something that you know, this has been a long time.
People are going back.
To like Drudge Report and these news aggregators because the using Twitter to surface the stuff is just not as effective anymore. And the newsletter business, obviously with the substack Semaphore, which has been Smith's new outlet, Puck News, right that newsletter business which is again email Base, it's this legacy technology that's been with us for a long time that's coming back into play as well. So it's it's pretty wild to see the evolution that's happening in right.
Yeah, I really might do that mologue. We're going to talk to Ben Smith on Thursday. We'll probably released it sometime on the weekend because it's going to be not in the main show. But there's a lot to be said about his book about that era, so much of what went wrong, but also about what we can learn from them. People like you and I were on the forefront. I don't want to be. I don't want somebody on YouTube who's.
Look at Yeah it's like they got arrogance. Yeah it is, and I think about it all the time.
But I suspect that the chain was not thinking about that though whenever he was.
I mean, you know, yesterday Christals so.
High flying, all these people getting these billion dollars.
But yesterday, Crystal, you and I show, our show was that's probably the biggest show we've ever done in terms of our YouTube and on podcasts together, if you combine it, if not the biggest, maybe the second largest biggest.
But we're still sitting here being like, man, you got to take it easy. You gotta be careful. You got to make sure that you don't go into crazy debt to build a new studio. Everything you want to do is cash flow.
These are not the decisions that they were making then at the time.
Sorry.
If anything, you know we have learned.
Something, all right, Tago, what are you looking at?
Well?
Last week I did a monologue that many of you appreciated, summing up what I hope to be the final monologues on lab leak. The evidence is so overwhelming at this point for the positive case that COVID lead from the Wuhan lab in twenty nineteen that you, in my opinion, have to.
Be adult not to believe it.
Unsurprisingly, though, many adults include mainstream media and worse, top officials in public health. So I just thought it'd be fun to just check in on all of them and see how they're dealing with this new reality. The first is a very quick update about a farce that I brought all of you a few weeks ago, when the Atlantic mounted a last ditch effort to defend the natural origin hypothesis. The latest cope theory was that infected raccoon dog meat was the genesis of COVID because an infected
dog sample was found at the Wuhan wet market. What they, of course neglected to tell you is that that sample came from early twenty twenty, when COVID was already swamping the entire city of Wuhan, and that there isn't a scrap of genetic evidences say that the dog is where it all began. They also failed to tell you that the leading scientists pushing that theory were involved in a lab leak themselves and were involved in the original cover up of the Labe theory with doctor Fauci in January
twenty twenty. Interesting how that works? Huh, Well, the funniest thing has happened since then. The theory from the Atlantic was so flimsy and useless that the scientific study it was based on had to issue ameya culpa update that even The New York Times is feeling compelled to publish headline Scientists revisit data on raccoon, dogs and COVID, stressing
the unknown subhead. After analyzing genetic data swabbed from a Wuhan market in early twenty twenty, a virologist said it was unclear if animals for sale there had been infected. The new study and the analysis around it is completely humiliating for the Atlantic and all of those who clung to this last ditch natural origin effort. In fact, the findings vindicate those who believe in a lab leak because the real.
Analysis shows this.
It wasn't just raccoon dog meat that had COVID on it.
It turns out COVID and.
Viral samples were all over meat samples everywhere in the market in early twenty twenty, indicating COVID did not come from the Wuhan wet market, but instead humans were depositing viral material over everything they were breathing on. Since the wet market is the only real natural origin theory, it instead shows that humans brought COVID to the market. If humans brought it there, it had to come from somewhere. That somewhere is the Wuhan lab a few miles away.
It really doesn't take a genius to figure all this out, As you might be wondering, did the Atlantic issue correction at all?
No.
Of course, not days after Catherine Who's loser of a scoop, she was still touting the raccoon dog theory as some sort of slam dunk, and as of this writing, she has not yet addressed her embarrassing mishap or apologized spreading dangerous misinformation which might have led people to falsely believe in the natural origin hypothesis. Catherine Woo, though, isn't the
only one still clinging to the natural origin theory. Ryan and Emily did a great job of looking back at doctor Fauci's lives during the pandemic and his pathetic defense of them today in The New York Times. But the part that actually stuck out to me was his cope on lab leak and how he seems to pretend he was always open to the idea and in no way did anything to make sure that people wouldn't believe it
during the critical period of early twenty twenty. Throughout the interview, Fauci plays several tricks to try and obscure a lab leak and the risks that they pose then and in the future. For example, he says, quote, it wasn't an engineered virus. Somebody went out into the field. Let's say they got infected, came back to the lab, and then spread it out to other people. That ain't a lab leak. Strictly speaking, that's a natural occurrence. Really, is it in
a natural occurrence? If you pay somebody to go deep inside of a cave and they get bitten by a bat or some other creature that humans never would have encountered naturally, and would then have that person spread said disease.
Is that really natural?
And when the interviewer challenges Fauci that obviously that research would have been the cause, he pivots and he says, actually, the interviewer is wrong for saying that if he were Fauci, he would have had trouble sleeping at night over potential lab leaks. He replies, quote, I sleep fine. Remember this work was done in order to be able to help us prepare for the next outbreak. From there, he launches into a spirited defense of gain of function research how
it has made us so much safer. He simultaneously claims that we never funded gain of function at the Wuhan Lab, and the gain of function research is essential and was essential to helping with COVID. His evidence is the mRNA COVID vaccine, which the merits of the vaccine and its efficacy aside today of which there are our questions with respect to how it was even sold to the global public. The evidence a gain of function research, especially at the
lab and others. What contributed to it that is bunked, according to people who are in the field themselves. Finally, Fauci ends by saying the lesson from COVID is not we need better guidelines around gain of function. We need billions of dollars more instead, according to him, to be spent quote, preparing for the next pandemic. He was never once stopping to consider that his so called preparedness is what led to all of this in the first place. And I know so much of this feels like beating
a dead horse. But this interview was published as five days ago. The raccoon dog theory is recent, is just a few weeks ago, the latest research debunking.
It a few days old.
I've come to the conclusion that I really don't want to let this die, because inquiry into the origin of COVID, for me, has turned into an intellectual journaly where we have discovered the colossally dangerous network of labs across this earth that have likely spawned diseases that may be the death of all of us. We already know things like lyme disease, ebola, and COVID.
Those are the ones where there.
Is at least some evidence that they came from a lab but as recent increase have shown, they're not going to stop. They keep wanting to do more and more and more, And it seems to me that to save humanity, we probably need to stop the people who are claiming to do research in the name of saving humanity. I've been attacked by the scientific community over this, Crystal that you don't understand what you're talking about, and it's like.
Wow, And if you want to hear my reaction to Sagres's monologue, become a premium subscriber today at Breakingpoints dot com.
Crystal, what are you taking a look at?
Well?
Guys, Yesterday, in the wake of the second largest bank failure in history, we told you that so far the collops doesn't appear to be causing a larger contagion, but that didn't mean there weren't still warning signs on the horizons. Specifically, Warren Buffett's business partner Charlie Munger is sounding the alarm over the US.
Commercial property market.
A lot of real estate isn't so good anymore, Amonger said, we have a lot of troubled office buildings, a lot of troubled shopping centers, a lot of troubled other properties. There's a lot of agony out there. This was an interview with the Financial Times. He went on to say American banks were quote full of loans due to the decline of that market. That got me wondering just how bad could it be? And the answer looks, frankly pretty calamitous.
In fact, a recent report from Morgan Stanley warns that the commercial real estate crash could put the two thousand and eight housing crash to shame. That report points to three factors that are combining right now to decimate that market. First, COVID dramatically accelerated a remote or hybrid work trend, which has left many office parks virtual ghost towns.
In the faraway distant land.
Of twenty eighteen, less than six percent of the workforce was remote. Today that number stands at twenty six percent, so more than a quarter of the nation's workers are fully remote. What's more, sixty six percent of employees work from home at least some of the time.
This is an extraordinary.
Change in how we do business, which obviously has dramatic repercussions for office needs. What's being described as an office apocalypse has meant that less than half of all offices are currently occupied, that is compared to ninety five percent occupancy rate pre pandemic. Just think of Amazon spiking their big plans for HQ two in northern Virginia to do
the tech downturn and the work remote revolution. Think of all those downtowns that have emptied out as office workers stay home or put in only a couple of days at the office. What is the value of that idle vacant office space, which, for logistical and often zoning reasons, is not really convertible to anything else.
At least not easily.
Second, just as the Fed's interest rate hikes have spiked mortgage rates, putting a freeze on the housing market, that same dynamic is also spiking rates for commercial real estate as well. And this comes at the worst possible time. Due to the third factor mentioned in the Morgan Stanley analysis, the entire sector is facing what's being described as a refinancing wall, where in more than half of the two point nine trillion dollar market is set to come due by the end of twenty twenty five.
That is just around the corner when bars, already.
Hobbled by remote work trends, go to refinance and find themselves with multipoint higher mortgage rates, How are they going to swing it? Many will not, that is the bottom line, and plenty could default before they even get to that point. Needless to say, when you're talking about a one point five trillion dollar wall of debt, it is no small matter. In fact, analysts are predicting that office and retail property
valuations could plummet by forty percent. And as if looming massive defaults and forty percent drop in valuations isn't bad enough, seventy percent of that debt is held by banks. So going back to Monger's dire warning here about banks holding a lot of bad loans, If anything, he understates the case. And it's not just any banks that are up to their eyeballs and very shaky real estate loans. It's specifically small and medium sized banks, which account for some eighty
percent of this type of lending. These banks have already been put on shaky round by the depositor flight to giants like JP Morgan Chase. How many will be sent over a cliff when we run face first into that one point five trillion dollar wall of debt now like Signature Silicon Valley Bank and First Republic banks with a lot of commercial real estate loans on their books are
subject to a lot of interest rate risk. So as the FED continues to hike rates in what has been an extraordinary death march to strangle workers and crush wages, they could well be tightening the noose around the necks of many more small and medium sized banks will face a reckoning over just the next few years. And sure enough, the FED is meeting again this week to consider their next steps. Now they've already engaged in the most aggressive program of rate hikes in four decades ever since the
Bulgar era, they are expected to continue hiking rates. This time, a quarter point rate rise is expected. What happens after that meeting is really anyone's guess. Some FED officials believe that rate hikes should continue to be hiked, should continue aggressively. Consequences to workers into the economy be damned. Others are ready to press pods. Meanwhile, two thirds of economists view
of recession is likely right. Rate hikes have already started to break things in the economy and in the banking sector. No one should have any confidence that they actually know what's going to happen if they continue down this path. So that's basically the landscape not very pretty, wall of debt made more crushing by rising rates with a new post pandemic reality that is not going back anytime soon,
if ever. And as we approach this reckoning, having watched what happened with Silicon Valley Bank, we now know the federal government effectively considers all banks too big to fail. How many bailouts might we be on the hook for as they desperately scramble to sell off the pieces in a collapse? How much more gigantic will the big boys,
and especially J. P. Morgan Chase become. What sort of contagion could result from a more widespread banking crisis, And how much socialism for the rich is American public really willing to accept? As I dug into these numbers, Sager, you know, as a little sort of casual comment from Charlie Munger.
It looks really bad.
And if you want to hear my reaction to Crystal's monologue, become a premium subscriber today at Breakingpoints dot Com. Joining us now is filmmaker James Fox. He's got a new documentary out, Moment of Contacts, been out for a little while.
He was on the Joe Rogan.
Experience, and it details an extraordinary incident in Brazil from the nineteen nineties. James, it's very We're very excited to have you join our show and to talk to you.
Thank you so much.
Thank you guys for having me on. I really appreciate it.
That's our pleasure.
Let's put the poster up there on the screen for those who are interested, and I do encourage everyone to go out and to rent the documentary, to watch the documentary wherever it's available. Moments of Contact the Roswell of Brazil, James. For those who didn't see you on The Joe Rogan Experience, can you just describe a little bit about what you find and investigate in the documentary about the so called roswell incident in Brazil Virginia.
Yeah.
So it's funny. It's like it's one of those cases where people.
That are familiar with my work.
I've been on Joe Rogan before with a film I did called The Phenomenon.
I've worked a little bit with former Sentiment.
JORI leader Harry Reid and Podesta and a handful of others, both Republicans and Democrats, and and so I sort of developed some a level of credibility that I never as a citizen, never had before. So I really went out on a limb making this documentary because this is about an alleged UFO crash that happened in nineteen ninety six in Virginia, Brazil, in the state of Minas de Rece, which is about four or five hours to the north
of South Paolo. And I knew Joe Rogan heard about the case, like a number of times, he had some of his guests talking about it. We had sent him links. The level of skepticism is warranted, and I understand that, but all I ask people is that suspend judgment and just listen to the evidence of the people that were there, the first hand eyewitness testimony from military officers, from firemen,
from doctors, from civilians, lawyers. It's absolutely mind bending and what you're left with is something truly extraordinary took place in Virginia, Brazil, January twentieth, January nineteen ninety six.
Yeah, yeah, Well, I watched the film last night, and what was most persuasive to me was the fact that you had so many witnesses and these aren't like you know, UFO buffs who are deep in the space or it's not just like one one off person who could dismiss as cook. These are just like regular Brazilian people, families, kids, business people, whatever, who are telling you about what they
saw and experienced on that day. The part that I actually find kind of the hardest to believe is the fact that the Brazilian military and working conjunction with the US military, are able to marshal this response so effectively and so quickly and to shut everything down like that level of competence and international coordination was actually the part that I was that I found the hardest to believe.
What do you think?
I don't blame you one bit.
I actually had people like Leslie Kine, who is one of the contributing editors to the New York Times story that exposed the secret Pentagon UFO program in December of twenty seventeen. It was Helene Cooper, Leslie Kane, and Ralph Blumenthal. Anyway, Leslie was like, are you sure you want to report on this case? I said, Leslie. I've known Leslie for quite some time. I said, Leslie, I think there's a lot to it. I really do. And long story short,
she reached into her deep contacts. She went public with this about two weeks ago INTEL contacts off the record, and they told her.
That it happened.
So the fact that she's come forward and said that, and I've talked to other people like Louel Azondo, who's also said to me, I learned that this happened during my time at a tip.
Yeah.
Let's for those James who aren't familiar with the acronyms with Louel A Zondo and all this, and even with Virginia.
No, no, it's completely fine.
Let's just describe the timeline of January nineteen ninety six about what witnesses report in the film. You don't have to give away everything from the film, but the broad contours, the Brazilian and the US military response, alleged response, and then some of what you've been able to uncover with new reporting, which we're going to get to in a little bit.
Yes, So let me just quickly finish what I was just saying in terms of the US involvement. I've been investigating this case for twelve years. A lot of other people that have investigating in Brazil a lot longer than me, And during that twelve year investigation, I was going back and forth to Brazil countless times a month, a month each time, I was completely unaware that there were any American involvement. I actually learned that on the last trip,
just a year and a half, two years ago. So we I'll quickly tell you that every military person that we met with, and they're all featured in the film at some point, particularly in the credits at the end, all said the Americans.
Were involved while we were there. The last time.
This was really was shocking, was that the flight military flight control officer. Now, when you're in the fire department, you're also military. When you're in the police department, you're also a military. When you're a flight radar control officer who monitors airplanes that come in and out of Brazil,
you're also military. And this guy, Carlos Fedis f E. R Ees came forward on the record saying that he was in charge that night and saw the United States Air Force plane come in without authorization from the Brazilian government.
It came in and it landed directly. This is on the record, you can go and look it up.
It came in and it landed in Campinas, Campenis, without any Brazilian authorization. He kept saying USAF. I was like USAV, what's this guy talking about? The United States Air Force? So it landed a Campenis and we have testimony from the military base as a from people that were that were there, that went on the record that said they drove these creatures to Campinas on that date. So we have testimony for a military personnel on the ground, some
civilians and doctors, lawyers about this incident. And then we have confirmation from the flight control officer who's also part of the military, who said he saw the flight come in and it's truly extraordinary. So let me say that in and around the town of Virginia, Brazil, January nineteen ninety six, you.
Had farmers, you had truckers.
You had professors, in particular Carlos Sosauza, who's also an ultra light pilot, who witnessed a cylindrical sort of cigar shaped object about the size a little bigger.
Than a really big school bus. It was metallic.
It didn't have any wings, it didn't have any exhaust vents.
Or visible means of propulsion.
It was just a cylindrical shape object with a gash in the side of it. That looked like it was in trouble. We film a number of witnesses that saw this in the middle of the night and it was just struggling to stay according to the witnesses, struggling. It looked like it was going down, but struggling. And then eventually there was a witness at a place called Myolini Farm on the outskirts of Vargina that saw it impact. The ground went up there, the military arrived. He was
met at gunpoint to leave the area. Never once did Carlos de Salaza think that I just witnessed something that crashed potentially from another world. He thought it was some super secret government craft. He had no idea. A few days later there were reports in the town of these of these like four feet tall. I know this sounds crazy,
believe me, I do, but these are very credible. And lots of reports coming in about entities that have brown skin, no hair, oily, big, big red eyes, ridges on the forehead, spindily, weak, frightened and scared, cowering, non threatening, and and these reports came in from fire department, from police department, from local civilians. I mean, one of the most incredible accounts is from three girls in broad daylight that came within eight to ten feet of this creature, and it's truly.
Remarkable and reportedly, you know, what you report on in the film is that one individual who was charged with capturing these things and you know, actually had it reportedly in his arms, he ends up dying in a mysterious way. Uh thereafter, can you speak to I understand you've learned a little bit more about what might have happened there.
So this is an ongoing investigation, and just last week we got a hold of the two forensic pathologists who worked on the deceased military officer doing the autopsy, and they're coming forward for the first time now.
They're providing a very detailed, long.
Form autosity report that Leslie Kane is actually having translated medically professionally because it's very technical. But they gave us brief statements that we're gonna share that I've just shared with you. I was gonna I was gonna start it with with Joe Rogan, but we just forgot we didn't
get to it, So I'm handing these to you. These are brief statements with translations, and you could play them directly from the horse's mouth from the from the forensic pathologists who did work on the on the deceased military officer.
Great.
We have some of those clips here for those who are listening. I encourage you to come watch this on YouTube because we have subtitles. Let's take a listen.
We'll see.
Study is.
Nice?
Is she on the aviation?
Ed? I?
I will be so.
Was someone what we're seeing there? James.
There's a longer video, of course, which I'm sure you'll put in a future film.
But one of the points that.
It's been taken away is that these pathologists describe a bacteria that's never been seen before on Earth and ended up killing a person who ended up transporting these creatures, and alluding also to et and kind of the light at the nfsent. Can you translate some of that for us as to.
I get the chill as.
I get the chills as someone who's been looking into this case for twelve years, and I know that Marko Lea, my Brazilian counterpart, has been doing it much longer than I have. The fact that we've got these guys, and I tell you I literally was doing zoom calls a couple of days leading up to going on. Joe rogan begging and pleading with these doctors to come forward, and one doctor said, hey, if this, if he comes forward,
I'll come forward with him. Will do it together, power and numbers, And then ultimately they did, and they provided us with long form but basically what they're saying, in their entire career, they've never seen anything like this bacterial infection that killed a perfectly healthy twenty three year old military police officer. And they said that they threw the I even interviewed We even interviewed doctor Cesario who worked
on him while he was alive. He said, I threw the kitchen sink at him and this nothing was working and this bacteria, it was just a They did never see anything like it. So they took samples, which I know that they're going to have more details on about this type of bacteria, but those are just the initial statements that they're making. And again I have to remind your audience this is an ongoing investigation. I'm not going
to put this in another film. I'm going to put it out to the general public immediately because I think that this is a story that could prove once and for all, could settle the debate once and for all whether these things are real or not, because we have a case unlike Roswell, that's so recent that the vast majority of people and witnesses are still.
Alive and they're coming forward right now in droves.
Yeah, I mean, James, My takeaway from this was either an alien craft landed in Virginia and Brazil in nineteen ninety six, or somebody escaped from some crazy bio lab with an unknown strain of bacteria or something that then the US government of the Brazilian military hopped in and it created some very strange disturbances in the town of which many of these people never forget. I mean, you can tell from the documentary this is a traumatic experience.
None of these people wanted to come forward. In many cases you describe having to go through and solicit and beg people to come forward.
Can you talk a little bit about that.
Absolutely.
Well, while we're on the subject matter of cash material, just before we get into this, your audience just has.
To hear this. Okay, this is the recently passed excuse me.
While I put my old man glasses on UNAP legislation by Senator Jillibrand and Marco Rubio Diego and all also contributed to this. But in any case, this just passed signed into law, the UFP legislation.
I'm going to read you one of the.
Bits of text, and I'm going to ask your audience what prompted this? Okay, here we go, any activity or program by a department or agency of the Federal government or contractor of such a department or agency relating to unidentified anomaloist phenomena, including with respect to material retrieval, material analysis, reverse engineering, research and development, detection and tracking. They talk
about crashed MAI, potentially crashed materialists like covered UFOs. The legislations right here, you can go read it, and they're providing whistleblowers.
Pretend, James, are you are you hopeful that some of these DC based efforts on Capitol Hill will lead to increased transparency and information.
Well, so everybody thinks that there was this sudden epiphany by the US government to provide Joe public with far more data on the phenomenon, That's not what happened. What happened was there are a couple of insiders like Christopher Mellen, former Deputy Assistant Secretary of Defense for Intelligence, and lou who ran the a TIP program, and a handful of
others decided, Wow, the level of secrecy is ridiculous. We are going to find a loophole, walk some evidence out of the Pentagon, which is what happened, and directly onto the front page of the New York Times. Now, the problem is the government can't put the genie back in the bottle, okay, so the intelligence agency. When I met with Senator Harry Reid, former Senate Majority of Leader Harry Reid about this topic, he said that when he launched the UAP Task Force it was called went from as
APP to a TIP Advanced Aerospace Threat Identification program. He said that the intelligence agencies were digging in their heels. They were fighting, ticking, catching and biting. They didn't want this, and I suspect the same thing as occurring right now.
However, what I'm doing, and what many others are.
Doing, We're meeting with the intel folks on the inside that have already gone to testify to ERROW, which is run by Sean Kirkpatrick. It's the new UAP Task Force, and they're going on camera with people like myself, and I've gotten a number of them on camera already, and they're disclosing not the classified parts, but what they've disclosed basically behind closed doors.
In other words, I'm providing the names of the programs.
I'm providing the names of the individuals involved with the programs, the locations of these programs, and in fact, if you get me the classifications.
I can walk you in the door. So the clearances.
So if the government is not going to release it, we're going to release this to the public so they'll know that this is going on. So we're just trying to force the government hands. And look, there's a lot of elected officials like Senator Jillibrand and Rubio, Mark Warner, Diego Gyagher, Andre Carson that are really batting for us, that are really there. They need our support, but they are They're going to bat They're not trying to cover this up. They're trying to actually get this open, but
the intelligence disease are being very difficult. There's nothing in it for them to share what they have. And there's a lot of amazing photographic evidence behind just behind that wall that I'm that we're talking about as well.
It's so frustrating, James. I feel the same way that you do. I hear the exact same thing. And the overwhelming thing that I hear from the inside the intel community is they're terrified because they just don't know what's going on, and they don't want to admit that to all of us.
They're terrified.
That's exactly right, So you know these I just talked to Christopher Mellen, who's also got to clearances, who's seeing the satellite, the satellite data, photographic evidence, and he said, well, I'm only talking about it because Ratcliffe talked about it.
But I'll tell you right now it's amazing.
And I said, Christopher, please, because I'm friends with christ can you give me a little more. He's like, well, you imagine like full four K of craft. It's about as good as that, and it's just behind that level of secrecy. So it's only a matter of time where some of that stuff's coming out.
I'm very confident, it's just a matter of when.
Wow, we can only help.
James, is there anything you want to say to the audience before we let you get out of here?
Well, I would say, if you check out moment of contact and you still feel nothing. The absolutely extraordinary took place in January of nineteen ninety six and Virginia, Brazil checking Parmesana dinner on me.
All right, I love it.
People can go and watch the documentary. Follow him at James Fox. Is it James C.
Fox on Twitter?
I believe yeh at James Sea Fox.
There you go.
He's a mad man. He just opened up his DMS. I don't know why anybody I know. Good luck to you, James's Thank you, sir, welcome back any time.
Thank you.
Man.
I love talking to that guy. Really interesting subject.
Thank you guys so much us for supporting us for all of the monthly year in lifetime members who have been helping us with our new studio and have been signing up for our mission.
We're very excited.
We've been having absolute gangbuster days here over at breaking points, which is kind of amazing because it's not even like there's some major.
Tens not under the key to the presidential election. Yeah there's no, I mean yeah, yeah.
It's pretty it's pretty awesome. Vice is dying, BuzzFeed is dead. Many of the new media companies we're supposed to define the twenty tens are literally bankrupt. Meanwhile, things here are better than ever. I suspect the same for many of our friends in independent media. It's a great time. It's a great time to be in this game, and we couldn't be in it without all of you.
We love you. We have a great counterpoint show for
Everybody tomorrow and we will see you all on Thursday.