Hello, and welcome to another episode of The Mark Moss Show, where, of course we're always talking about the decentralized revolution, talking about the way the world is changing. Yes, it is, have you noticed? And it's changing right before our eyes. Now, it's always technology that changes the world, but it changes it through three spheres. There's the political, the social sphere, there's the financial sphere, and then there's the technology. Technology is the driver and we look at it from all
three of those angles. Of course, we talk about bitcoin being this decentralized technology that's changing the world. And today we have a big show. I want to talk about the everything bubble. You've been hearing it all over. What is the everything bubble? Where did it come from, what's the timelines, what are the key indicators that we should be watching, what's the danger because of this? And what should we be doing to protect ourselves from the everything bubble.
We're going to dig into all of that. How to protect your wealth, how to protect your family, what the experts are saying, and so much more. Now, I just want to do a shout out. I don't typically do this, but just shout out to a company called Don't Tread on Me. You can find them on Don't tread on Me dot com and they were nice enough to send me a couple of shirts. You can see it right here. They see that I use this coffee mug all the time, says don't tread on Me. And I bought this at
BUCkies in Texas. Shout out to BUCkies. But they see that I use this, and so they sent me a whole box full of gear. So I didn't want to shout out to them, and I just want to talk about it for a second. You know, the reason why I like this mug is to me, this symbol could mean lots of things to lots of different people. And some people might tell you it's I don't know, racist, or supports slavery. I don't know what they want to say. I don't care about any of that. What I want
to say is what it means to me. Now, this goes back to the American the original colonial war, and it's been used many, many times as a symbol. Benjamin Franklin used it, and basically it means.
It's like a warning.
It was you used when it was created as a warning to Britain not to violate the liberties of its American subjects. That's what it was created for and that's how it was used originally warning to Britain not to violate the liberties of American subjects. And the reason why I like this is it's to me, it's a symbol of live and let live.
Look, I'm gonna do meet. You're going to do you. Good job, you go do you.
And the way that I think the world should work is that we should lead by example. I want to be a good example for my kids. I want to be a good example for my audience. My social media and stuff, you'll see me talking about things I do for business or coaching clients that I work with, helping their businesses grow, and I always do it from a place of this is what I am doing in my business.
And then I might talk about these are things I've helped other businesses achieve, and it's always from a place of leading by example. I'm not going online. You won't see by my social media saying this is what.
You should do. You need to do this, you see.
And that's what I see is this big discrepancy between these two politically ideology separated sides that we see in the United States and really in the world today. You have one group of people who just want to be left alone, let me take care of myself and my family and just live my life, and then you have another group of people that constantly want to tell you
how you should be living. And that's a problem. I was at an event I don't know about a year ago and somebody asked me, how do you know that you're on the right side, And I said, I had to think about that for a while, and I said, the reason why I think that I'm on the right side is because I'm on the side of freedom. I'm gonna do me, and you're going to do you. I'm not telling you what to do. I'm right because I'm only gonna I'm only going to discipline. I'm only going
to manage myself. You do you. And so that's why I love this flag, the Gads. It's called the gads and flag. It says, don't tread on me, don't step on me. It's a rattlesnake, which means the rattlesnake is like, hey, let me go do my thing and I won't bother you. But here's the butt. But if you do come after me. If you do step on me, watch out. The rattlesnake has its tongue and its fangs out, and.
So it's like, hey, live and let live. You do you, I'll do me.
But if you want to come and harass me, back to its original attention to Britain, if you want to come and violate the liberties of American subjects and today, if you want to come and violate me, well then watch out. So I don't want to be violent.
I don't.
I don't advocate for it for any means. I believe in liberty for all live and let live. But if you come after me, then you better be prepared. And that's why I like this. And anyway, so shout out to this company. Don't tread on me dot com check them out. They were nice enough to send me, like I said, a whole box of goods. I don't typically wear anything other than a black shirt, but I wore this because it had like a light black print on it.
Anyway, let's jump in too. We're talking about the everything bubble. You might have heard of that before. Now.
Bubbles are when financial mark kids get frothy and they start rising, rising, rising, rising, rising, And like most bubbles, they eventually pop or they deflate. Right, a balloon deflates or it blows up, And so we can see that in financial markets, we have bubbles that are bubbling up as well, and they get very frothy, and at some point the bubble deflates. You have like a balloon with
like a pinprick, and the whole thing deflates. Now I'm gonna we're gonna dig into, like I said, what they are, what are the causes of them, what the experts are saying about, and what the alarm bells are we should be watching. And then, of course, like I said, how you can protect yourself. But I also want to let you know that we're always in a bubble. We're always in a bubble.
It's just at what stage of the bubble.
Is the bubble just barely forming or are we all the way at the peak?
Now?
The problem with are we all the way at the peak is that we don't know. It's easy to see when reality is starting to separate from perception. That's what I call volatility, the difference of perception of reality.
It's different. It's easy.
We can see when prices are over their historical norms or below. If they're expensive or cheap. We can see that. What we don't know is when things will return back to their means or revert past their means.
We don't know that. And so while it's easy to say we're in.
A bubble, and I'm going to read from you, have a lot of people say we are in a bubble. Sure, I'll say that we're in a bubble too.
I put my hat in the ring. We're in a bubble.
But like I said, it doesn't mean that the bubble's going to pop today, tomorrow, next week, or next year, because these people have been calling for the bubble to pop for a long time. After the two thousand and eight financial crash, I've told my story many times. I had made a lot of money. I had an eight figure portfolio. I was young, I just had my first kid. I was done in life, and then out of nowhere, the great financial crash came and just knocked me on my rear.
Let's just say that.
And it was part because I didn't understand this financial system. I was focused on making money and I had done really well.
I had multiple.
Businesses, big big exits. I had developed a bunch of real estate, and I was sitting on an eight figure portfolio, and like I said, I was pretty much done. I had sold the businesses, etc. But the financial system that the Federal Reserve manipulates and other central banks around the world had control over my life. I wasn't paying attention to it. So I had to go figure that out. And so part of me rebuilding was figuring out the game of money. Who were the players, what's the objective
and so forth. And the players are the government obviously the policy makers, but also the central banks, and there's other players as well, and I had to go figure that out. And once I figured that out, I quickly became a goldbug and I'm like, oh, shoot, the problem is this central bank policy and they're printing endless amounts of money, and every time they print money, that means asset prices go up, and then all of a sudden they take the money supply away and then asset prices come down.
This is horrible.
They're the ones costing this. It's their fault that the market's crashed and I lost all my money. The way to fix this is to go back to a sound money standard. And once I started to understand this, and I really started paying attention to the financial system. I kept thinking that it was going to crash again and again and again. Now being a real estate guy in twenty nine, ten, eleven, twelve, twenty twelve kind of mark the bottom of the market.
How was the time to get back in thirteen and fourteen.
But I kept thinking, no, no, no, no, it's going to crash again. The banks are insolvent. There's no way that can continue. Two thousand and eight didn't fix the banks. The banks are only worse off than they were before. I want to start buying real estate. And I was developing, I was building houses, as building commercial projects. I want to start doing it again. I enjoyed it, I had
fun with it. I saw opportunity it. And I remember thirteen, twenty fourteen, twenty fifteen looking at these deals and like, oh, I want to pull the trigger. But the market's going to crash again at any moment, because.
Look, we're clearly in a bubble.
Clearly this banking system doesn't work. Clearly this Fiat money system doesn't work. It's going to crash again, and of course it still hasn't. And so the point that I'm going to make as we go through this is that yes, we are in a bubble. We've been in a bubble for a long time. A lot of these economists have been calling for these asset prices to crash, these bubbles to crash for a long time, and it will eventually. And when you understand this better, you'll be able to
understand what I mean by that. If you're just tuned in, you're listening to the Mark Maas Show. Of course, we're always talking about the decentralized revolution, and asset bubbles are part of this because as the world is decentralizing and breaking apart, it's putting massive pressure.
On this bubble.
These are some of the things we'll talk about, so we're going to cover a whole lot of ground. What they are, what are the causes, what are the alarm bells you should be watching, and of course, ultimately, what do you do to protect yourself and your family. I'll be back with all of that and more. I'm gonna take a quick break, I'm gonna come back. We're going to talk about these bubbles potentially crashing and deflating and we should do about it.
Don't go away, were back, Hi, Welcome back.
If you're just tune in, you're listening to the Mark Maas show. Of course we're always talking about the decentralized revolution today talking about this everything bubble, what it is, the cause the alarm bells you should be watching, and of course what you should be doing about it now, the asset price bubble. As like I said, we're always in a bubble, it's just at what stage are we in. And really it refers to the impact of monetary easing
by the Federal Reserve and the central banks. So the central banks all around the world have been easying monetary policy. And this is going again, went back to my two thousand and eight example. This is what I first discovered. That's the problem. When the central banks create more money.
Asset prices go up.
When they reduced the supply of money, asset prices go down. Pretty simple, and we can see this throughout history. Now, before central bankers were able to print themselves money, what we would see is we would see new discoveries or pockets of what was money at the time, which would be gold or silver. So for example, you had you know, Spain or Portugal going out on expeditions to find more
gold and silver. It's how they found the new world right the North American continent, and they went to was it, I believe, Peru, which has like the greatest silver deposits in the world, and they started extracting all that silver and bringing it back to Spain and to Europe, and all of that new money supply comeing into the markets created massive inflation because you remember, we don't want money. What we do is we want the things that money buys us. We want the goods and services. So what
we really want is goods and services. Money is just the means to get that, and so we'll hold money until we've decided what it is that we want with it or at that time. And so basically what we really want is goods and services. So you divide all the goods and services in the world by all the money in the world, and so when you increase the money supply, then the price of those goods.
And services goes up. That's the way it works.
If you decrease the supply of money, then the price of the goods and services go down, because it's always a ratio because money is just a placeholder for those goods and services. So when the FED, the FED and otherston's banks around the world increase the money supply as the prices go up, and then lots of activity go
around trying to tap into that. So, for example, home prices go up, well, that means that people want to go buy homes because I want to speculate on the price of home, So I'm going to go what we saw through two thousand and eight, or really you know two thousand and five sixty seven leading into that, was people going and standing in line at track homes and they're going to buy two three homes because in a
year from now they can sell those for more. And because now people are buying three homes, then we need more people to buy homes. And now we need more contractors, more framers, more roofers, and those roofers need to work on more houses. So those roofers are trying to expand their operations. They're buying more trucks and they're hiring more people because there's more trucks than Ford is building more trucks, so then they have to order more supplies and they're
building new manufacturing hubs. And so just that one little increase in money supply, which increased the supply of the price of houses, has this trickle down effect that caused everybody to overbuild on false demand. The demand was only there because they increased the supply of the money, which I guess would be okay, because what's happening is the
goods and services are trying to catch up. But just as the goods and services are catching up to the supply of money, then reduced the supply money, and all of a sudden, we have too many goods and services. So they these contractors in this hypothetical example, well it's not really hypothetical, it's exactly what happened. But in this example, as he's as the money supply increased, as as asset prices went up, then everybody's rushing to increase the supply
of those assets. Remember prices are the equilibrium of supply and demand. So because when the money supply went up, the demand went up. So everybody in this home building niche all the way down to Ford making trucks for these home builders. As the as the demand went up, because the money spy went up, then everyone tried to increase the supply.
But then as as supplies.
Catching up, catching up, catching up, catching up, more builders, more builders, more trucks, more homes. As the supplies catching up, they rug pull everybody and pulled the demand away. And now that poor home builder bought all these trucks on credit, and now he's got no jobs to go work on, and how does he keep making his payment on all those trucks. This window manufacturer for homes just open up this whole new facility, this whole new warehouse facility to
get windows out faster for all these new homes. And now all the demand's gone, And now how do they employ all those people, and how do they pay for those facilities? And so when you constantly change the supply of money, the market's trying to react. But the problem is when someone's artificially manipulating it and they're not telling you what's happening, there's no way for you to plan
on that. So either asset price continue to just go through the roof because we don't bring a new supply on, or we try to bring supply on, but then we have to watch out for the rug pull. And this makes me so mad. This is one of the things that gives me the motivation to continue what I do, because the FED is purposely trying to bankrupt you in your family. If you don't want to play this game,
you can choose not to. Look, I'm not going to expand my business to keep up with to keep up with this supply and demand.
I won't. I'm not going to play the game.
Well, the problem is you're going to fall behind because prices are going up so fast. If you're not growing your business and your revenue to go with it, then you get left behind. Inflation eats into your cost of living and in your quality of life. So you're forced to play the game.
You have to.
You can either get left behind and that's not good for you, or you can play the game. And so then you do try to grow your business, and you do try to grow your employees and your equipment and things.
Like that to keep up with it.
So now you're taking on debt and you're trying to build your business, and you're doing all these things to keep up with it. And then they just rug pull you and they pull it out, and now you're bankrupt. As I drive down my downtown street and I see all of these businesses, I just feel bad for them because I know most of them aren't paying attention, just
like I wasn't paying attention. All they know is there's more demand for their goods and services than there ever has been, and so they're rapidly trying to scale to fulfill that demand. But the problem is, like I said, they're not paying attention like I wasn't paying attention, and.
They don't know that the rug pull is.
Coming and it's going to wipe them all out. That's what the everything bubble is. So the bubble is coming.
Now.
We saw the term of the everything bubble really kind of come out. In two thousand and five. There was an article written by Michael J. Burry and he used it to describe the housing bubble. You know, you might know who Michael J.
Burry is. He was the author.
Of the book that went on to create the movie that basically depicted this.
Whole housing bubble collapse.
It's called The Big Short And Michael Burry got famous because you know, he was the guy featured of the movie and he was the one that put this big short bet saying that the housing market was.
Going to crash at the time.
In two thousand and five, he wrote this article for the San Francisco Federal Reserve Banks Economic Letter titled quote the Everything Bubble and he argued that the United States was in the midst of a housing bubble that was being driven by low interest rates, easy credit, and speculation. Exactly what I said, right.
When credit is easy and cheap.
People take more of it, and so because we're in a debase montey system, more money's out there.
So he warned that was that was happening.
He said that it was unsustainable and that it would eventually burst lead into a financial crisis, and he was right. Now I want to point out that he was right, and so of course he's now famous because of the movie in the book that was written and made about him, But I do want to say that he was He ended up being proven right, but he was wrong for
a long time. And the reason why that matters is that throughout this process, he was buying these credit default swaps, and he had his investment funding all these investors' money.
But he was wrong for so long. He was losing all kinds of money, and he is investors one of their money back, and they even started suing him like he was so wrong for so long, and most people that were like him weren't able to withstand that, and they all had to pull out and just they took the loss, he managed to push through and stay long enough for it to eventually come true. And of course now he's famous for doing that. So that's about the bubble, right.
The bubble can last for way longer than we think it can hand and Michael Burry is living proof of that. Now, if you're just tuning in, you're listening to the Mark Mass Show, we're talking about the everything bubble, what it is, the causes, the alarm bells we should be watching, and of course.
What you should be doing to protect yourself.
I'll be back with all that moren a minute, but I gotta take a quick break, so don't go away. I'll be back.
All right, Welcome back.
If you're just tuning in, you're listening to the Mark Mass Show, we're talking, of course, every week about the decentralized revolution, which is the big driving force. But today we're talking about the everything bubble. You've probably heard about that term. What it is, what are the causes, what are the alarm bells you should be watching, and ultimately what should you be doing about it?
Now?
I was talking about how we're always in a bubble, but at what stage of the bubble?
Are we in all right?
And so Michael Burry said that the housing market was in a bubble, and he bet against it, and he was wrong for a long time and lost a lot of money, but was eventually proven right. The broken clock is right twice a day.
Right.
But we've seen other economists have been calling this for a long time. Economist Robert Schiller, he popularized the phrase in his twenty fourteen book called Irrational Exuberance. I think Warren Buffett said that the markets can stay irrational longer than you can stay solvent. And that's what happened to almost everybody else that tried to do what Michael Burry did. They all saw the markets were going to crash. They
all placed their shorts. The markets were irrational, but they stayed irrational longer than most of them could stay solvent because they were losing money on their bets. And so in twenty fourteen, in this book, he argued that the stock market was in a bubble twenty fourteen.
Well, since twenty.
Fourteen, the markets have continued going up, So sure they were in a bubble, as he argued in twenty fourteen, I agree, and I agree they're also in a bubble today. But if you would have put a short on the market in twenty fourteen, like he probably suggested after he read.
The book, he would have been wrong.
You would have been wrong over and over and over to the tune of losing lots of money. Now we can all say the markets are going to crash. As a matter of fact, I'm willing to guarant he you one hundred percent. The markets will crash. Now, I don't know by how much or when, but they will crash, right, And so you have to define that. And so in
this example he was wrong. We can see in twenty fourteen, Janet Yellen gave a speech at the IMF International Monetary Fund discussing the possibility of this everything bubble again back in twenty fourteen.
And she said, yes, yes, you're right. Asset prices have.
Risen significantly in the years, but they're generally in line with historical norms. Well, if you do mental gymnastics, and then you account for what we call inflation, So if you adjust for the increase in the money supply, I suppose, But when the average home in nineteen seventy was like thirty forty thousand dollars and today it's three hundred thousand dollars. How is that in line with historical norms? Only if you're a essential banker.
Like her, She said.
Prices of real estate equities, corporate bonds have risen appreciably and valuation metrics had increased, but again they remind they remain in line. So if you're looking at public equities, we have what's called up price to earnings ratio. So what is the ratio of the price of the stock or the company to the earnings that they have. If you're buying a business, Warren Buffett said, I don't buy public equities.
I don't more.
Buffer said, I don't buy stocks. I buy businesses. The businesses just happen to be publicly traded. And the reason why it's important to understand that is because we should be buying businesses that produce cash flow. If I'm buying a business, or in my existing business, the point of my business is to make money. How else am I going to pay for my people that help and the buildings and all these things that we have to do.
So the business needs to make money. So if I'm going to invest into a business, if I'm going to buy in a business, that business should be making money. That's the earnings divided by the price. Now, what we can see is that going back to two thousand, the year two thousand, the S and P five hundred pe ratio, the price earning ratio was under twenty with a couple spikes. As a matter of fact, it was typically more fourteen fifteen. What we're seeing now is that we're way over twenty.
As a matter of fact, some of these stalks are twenty five, twenty eight, twenty eight times insane. So to say that we're in line with historical averages is pretty much.
Wrong in my opinion.
Now, as the central banks, as I kind of started out in the beginning talking about every time they increased the money supply, we get these asset bubbles.
When Spain and Portugal brought back all.
The silver from Peru, it created inflation asset bubbles, and so we can see that these asset bubbles have gone throughout history.
One of the most.
Famous ones is in the sixteen thirties, and it's the most ridiculous one in my opinion, But that's in the benefit of hindsight.
I guess if you lived through it, you didn't see it.
But it's the Dutch tulip bubble, and basically tulips. Yes, the flower went into a big bubble and the prices soared twenty times on flowers, they're just scarce. Everybody won the tulip and then went up twenty times and then it crashed all the way back down nine nine percent of its value, lost it all. Now, one of the
things that defined that to the bubble. People might can compare that to the bitcoin bubble is that bitcoin has crashed ninety you know, eighty percent, eighty percent, seventy percent many times, but it always comes back. The tula bubble never did it crash, never came back. Seventeen twenty we had the South Sea bubble. Shares of the company served
more than eight times before collapsing. But more specifically, and this is really more about central bank policy, in the nineteen eighties, we saw Japan's real estate and stock market bubble crash. Values tripled after the stimulus that they put in, and then the bubble burst in nineteen ninety one. So nineteen eighty all the stimulus values of land in real estate tripled, and then nineteen ninety one it crashed.
It's never come back.
We saw then all the money went to the US. We saw in the nineteen nineties we had the dot com bubble, So really from nineteen ninety five to two thousand, dot com prices went to the moon and then crashed down, and then the Fed changed interest rates to then try to restimate the market, so then everybody plowed into real estate, which then led to the two thousand and six housing
bubble crash. So every time the FED tries to save things, they fix one problem, but they cause another problem somewhere. Eld sort of like I plug my finger in the damn hole here, and then we have a hole in the dam over here, and then I put this finger and then toes and you get the point.
And so that is how they're created.
Low interest rates because then people borrow more money easy credit. The banks give credit to almost anybody speculation, so people then start speculating, like I said, stand in line to buy all these houses, and that leads to a mania. Now these are sort of the causes of that, right, Basically an expansion of the money supply because it was easy, it was easy to get, they'd give it to basically anybody. In that movie The Big Short, they I think some
of the team. They went out to Florida to go look at some of the real estate in Florida, and like they were talking to people like, what do you own three houses? I mean, like they'd just give them to anybody. I recently went back and watched that movie again.
It's a good movie. You should watch it if you haven't already.
But the thing is is, like I said, everything Bubble seems to be in a general consensus that we're in that there's a few detractors.
I'm gonna talk about that in a second. But again, when will it happen?
Now? Who are some of these naysayers? Well, some of these naysayers are like Larry Summers. Summers is a former US Treasury secretary.
So that's Janet Yellen's job today.
I would mention to you by the way that the US Treasury, it runs the government's budget, the fiscal budget. Janet Yellen is like a full on Kinsian, a full on modern monetary theorist at MMT. She believes in just printing money tel infinity.
That's what she believes. And so.
For her, of course this isn't a problem because we can create as much money as we want and it's never a problem to her. Larry Summers also feels the same way. In twenty nineteen, he said that everything bubble was a myth, That's what he called it. He said the asset prices were not out of line with historical norms and that there was no evidence of widespread speculation. Let's break that down for a second. So he said the same thing as Janet Yellen. No, they're not out
of line with historical norms. Well, I already told you they are. Holmes went from thirty thousand to three hundred thousand the pe ratio of stocks, So even if you want to take a inflation out of the equation, the pe ratio in stocks is out of alignment. But he said there was no evidence of widespread speculation. Sort of like paying I don't know, one hundred thousand dollars for a digital jpeg. I think somebody paid sixty eight thousand.
I don't know.
I want to say it was like eighteen million for a piece of invisible art.
Invisible art, how do you even know if you got it? How do you know if they delivered it to you? I don't know. I can't see. It's invisible.
I would call that widespread speculation. If you haven't seen what's happening in the crypto space, the blockchain space, the NFT space today, the AI space, I would say that's widespread speculation. Paul Krugman, a Nobel Prize winning economists, argued in twenty twenty that the everything bubble is just a scary story and it was not supported by any data at all. But he also said that asset prices were not as high as they were in the run up
to two thousand and eight. There's no sign of wide spread speculation.
So who to.
Believe, Well, don't worry. I'm going to bring back the facts and the data, so you don't have.
To believe anybody.
Let's just look at the cold hard facts and see what some other people had to say about.
This everything bubble.
And like I said, we're going to talk about what are the alarm bells that you should be watching paying attention to, because we don't know what's going to crash, But if you're watching these signs, you'll know when we're getting closer, and then ultimately what should be.
Doing and how to protect yourself.
If you're just tuning in your listening to the Mark Mass show breaking all this down the everything bubble.
But I gotta take a quick break back with more in a minute, so don't go away. I'll bear back. All right, welcome back.
If you're just tuning in, you're listening to the Mark mass Show. We're talking about the everything bubble. You've heard that term, and we're covering what it is, what are the causes, what are the alarm bells, and how to protect yourself. Now, if you've missed any man, you've missed a lot, but don't worry.
I got your back.
Check it out on the podcast. Just search the Mark Moss Show on your favorite podcast player, or go to YouTube and search Market Disruptors and you can find all of my past episodes and you can watch me and listen to me.
At the same time.
Now we're talking about this everything bubble, and like I said, we are in a bubble, because we're always in a bubble. So for people to say that we're not, it's sort of ridiculous. It's just at what stage are we in? That's really I think what is open for debate. So what are the alarm bells that we should be watching for and what eventually happens? And then of course, yes,
what should we do about it? So, you know, some of the alarm bells are when we see that the abundance of the abundance of money, the money supply is going up way too fast, sort of like what we saw from twenty twenty to twenty twenty two.
Sort of like that.
Now, one of my friends, Jeff Booth, I've had him on my show, We've done a couple of interviews. Check him out on my Mark Moss channel. Jeff Booth, and it says that when we have an abundance of money, we have scarcity and everything else. When we have scarcity of money, we have abundance of everything else.
So think about that.
Remember, because we don't want money, what we want is the goods and services.
That money buys us.
And so as I said, we have to divide the money buy the goods and services. Now, if I increase the money supply, then I've increased the demand. So now there's more demand, there's more money chasing the same limited goods and services. So if I create more money, abundance and money, then all that money tries to go out and buy all the goods and services.
So then there's scarcity.
Right, That's what happened in twenty twenty between the Fed monetary and fiscal stimulus that went out all that stemmi money, trillions of dollars. Everybody started going to buy things. You couldn't get a bicycle or a kayak or a surfboard or a dirt bike or anything. Supply chains were broken down, and so there was scarcity of everything because there's too much demand, too much buying. There's scarcity of money. Then
there's abundance everywhere else. Now you lower the demand scarcity of money, and no one's going out to buy all that supply. So now we have abundance. So which sounds better? Do you want abundance of Do you want scarcity of goods and services that you can buy? Or do you want abundance? Well, of course we want abundance, right, we want more goods and services. I want more options, more selections. I want it on the shelf when I want I don't want to pre order it six months or twelve
months in advance. When I want that new car, I want the new car now. I don't want to have to worry that it's waiting on a microchip set on some lots somewhere. Some of the things that have caused is is when we start to see that to the kind of point that Paul Kru was saying that we haven't seen the speculation, but the speculation happens when commodities
turn into financial assets. So for example, your house should be your home, that's where you live with your family, with your kids, so they can grow up in the same neighborhood with their friends. But houses have become a financial asset. So now since I can't keep money in the bank, I got to go put it somewhere.
Where should I put it?
Well, I guess I'll put it into gold. So the price of gold goes up. I guess I'll put it into these stocks. Of the price of the stocks with I guess I'll buy real estate with it, and the price of real estate goes up. But the problem is is real estate is no longer affordable anymore because you have so many people buying real estate as a financial asset instead of just the utility value that the home provides or should provide. Gold has utility value. We can
use it for connectivity. It can transmit you know, audio video very very well. But the price of gold is up too high to really be used in that way because of the financial speculation. Because I can't save in money and in currency, so I'll put it into gold. I can't save in money, so I'll put it into housing.
The commodities themselves turn into financial assets. And when we have when we combine this low debt, the cheap debt meaning interest rates are low, and credit easy credit policies, so we have low cost of debt, but we have high inflation.
That leads to what's called a speculative attack.
So then we have periods where inflation is raging like we saw in twenty twenty one twenty twenty two. Inflation's seven eight percent, But I can borrow at three percent, So what's going to happen. Well, then I'm going to go borrow as much money as I possibly can at the three percent and invest it because of the inflation is at eight percent.
And what does that do, Well, that.
Only speeds up the doom loop. So now I'm doing that with real estate, which pushes the price of real estate up up even more because it's a financial asset and not for the utility value of being a home. And then unfortunately for the majority of people, they get priced out of the market. They can no longer afford that home.
Now, where does this go? Well?
One of the godfathers of the Austrian school of economics, Ludwig von Misis, which you should definitely read his work.
I'll warn you in advance.
It's not an easy read. These guys were so smart. It's a very academic read. But you can go on to Mesis dot org, sees dot orgg mes dot org and they have like all kinds of his work and other Austrian economists work, and most of it's all for free. You can download these books in like PDIA format for free. You could buy the books from them as well. There's tons and tons, thousands and thousands of articles. Highly highly
highly recommend you to go check that out. But a little Glamisis wrote something called the crack Up Boom, and he says, but then finally the masses wake up. Suddenly, the masses wake up. People wake up. They become suddenly aware of the fact that inflation is a deliberate policy that will go on endlessly. So you hear about the FED and the government talking about inflation all the time.
The FED has a target of two percent inflation. Now we overshot that to nine percent, but we're committed, Jerome palaceys, we're committed to bringing it back down to two percent.
So great, So you.
Only want to steal two percent of my wealth per year over five years, you want to take ten percent of my life, my life savings. You want my standard of living to drop by ten percent in the next five years. That's what That's what they're saying, that's the goal. So he says, sudden people will become aware that it's
deliver a deliberate policy. Now right now, they're starting to be talk about changing the inflation rate up from two percent, the target inflation rate from two percent to actually three percent, so he says, Mysa says, then suddenly people wake up that inflation is a deliberate policy. Yes, a deliberate policy. They want to now make it three percent now where they want to steal three percent of your life per year and it will go on endlessly. Is the second part,
deliberate and endlessly? So yes, people are starting to be pretty aware of that. And then he says a breakdown starts to occur, and then the crackup boom begins to appear. Everybody is anxious to swap his money against real goods.
So again, I don't.
Want to hold the money in the bank the money. What I want is the real goods. I'm going to go buy houses, shoot two or three houses. I talk about this all the time. I don't look at my investments as investments. I like to think of them as savings. So I make my money in my business and then I save it.
Where do I save it?
I save it in gold, I save it in bitcoin. I save it in real estate. Everybody's anxious to swap his money against real goods, no matter how much money he has to pay for them. So it doesn't matter how high the prices of.
The homes go up.
He's going to buy him anyway, because they don't.
Want the money. They want real goods.
And he says it here, no matter how much he has to pay for them. And it says within a very short time, within a few weeks or even days, the things which were used as money are no longer used as a medium of exchange. They become a scrap of paper that nobody wants to give away anything against them. So if you look at like you know Venezuela, Zimbabwe two of the best examples of this massive inflation that.
We can see.
And it's good sometimes to take things to their extremes you can understand them better. So in Venezuelan, Venezuela, well, Argentina too today. But Venezuelan and Zimbabwe had massive inflation. Why am I republican? Germany as well? Nobody wanted the paper money, so you can see pictures in Venezuela of literally the money is just laying in the streets.
No one's even going to pick it up.
No merchant would exchange their goods and services against them.
So what do you do?
Well, what you do is that you do that you don't hold onto the paper currency. You buy assets. You buy real things, land, houses, gold, bitcoin, You buy real things that aren't affected. If all my money gets inflated away, but I have a ranch with a one hundred and fifty head of cattle, I still have one hundred and fifty head of cattle. That doesn't change. That's the real thing.
And you should just know.
As this continues to evolve, unfortunately social social unrest picks up and things like that, and so we want to make sure that we have money that gives us more options to work around the uncertainty that this creates. But back to Mesus's point, when people realize it's intentional and permanent, and I think you can see that inflation is both of that, and so the everything boom continues. If you're just tune in, you're listening to the Mark Mashaw, we've
been talking about the everything bubble today. Hopefully this makes some sense of what's going on, what you should be paying.
Attention to, and what you should do.
Hit me up on social media, let me know what you think, as always, and that's what I got. Thanks so much for listening.