The Mark Moss Show Dec 17, 2021

K and uh. He is a He's an amazing financial analyst, really someone that I bounced a lot of ideas off on a macro level and I wanted to bring him on the radio. So Jason, thanks so much. We are joining me today. It's great to be on Mark. You're doing a really good job on here. Congratulations on your new show. Thanks man, thank you. I know, you know sometimes you've you've been been nice enough to start to send me a lot of information and and some d m s, and we've kind of gone back and forth,

and you know, there was something that we were talking about. Um, it might have been a week or two ago, a couple of weeks ago when we start talking about get you on the show, and you were talking about how um, the government the Central Bank, and the government is in this situation to a where a large percentage of their tax revenue now has started to come increasingly more from capital gains, and there's a reason why they need to continue to get asset prices to go up, including they

might even want to see bitcoin going up to a million dollars because they need that revenue. I think, is that? Is that right what you were saying. Yes, there's a lot of reasons for this. So there's been enormous structural changes in the annual US federal government tax or seats of the last couple of decades. So a couple of decades ago, capital gains, taxes on stock spawns, real estate, it was barely ten percent. Most years, it wasn't ten

percent of annual tax revenues. So the real economy, corporation, small businesses, that was what was paying the tax revenues. Now what has changed is, depending upon how you measure GDP, government spending now accounts for around fifty of g d P, and the government's not going to tax itself. A lot of corporation and don't pay taxes, especially the ones that are politically connected like General Electric or Tesla Motors that are relying on a lot of government subsidies to survive

and are not consistently profitable. So you have a situation where the government realized this, the Futtal Reserve Bank realized this, the large banks in the US realized this. The large banks decided a couple of decades ago that it was a lot more profitable for them. There's no caps on lending the amount of percentage interest rates that they could charge, so the large banks have basically they take depositor money and they take the reserves that the Futtle Reserve gives them,

and they could use that as collateral. They can pledge it, they can um put it as hypothecated and rehypothecated, all this stuff, and they put on hedge fund trades, so on stocks, bawns, real estate, currencies, commodities, over the counter derivatives. The majority of annual bank profits now is not from normal lending. It's from like leveraged hedge fund trades on

bonds and currencies and over the counter derivatives. So the this is what a lot of people have called the financialization of the economy, where the real economy um where there's investments by the follow government investments by the private sector.

The government releases press releases. You know, it's I've lived here in d C for over twenty years now, and there's always infrastructure plans announced, and these infrastructure plans, the return on investment on these things, the actual infrastructure never seems to get done correctly. It so basically, when the government spends money, it's not helping the regular people. It's going for corporate welfare, it's going for bailouts, it's helping

out large corporations and special interest groups. And that's where the capital gains on stocks, bonds, royal estate and now

crypto comes in. Because the official FED policy mark for the last two decades, and the FED doesn't even want to talk about this in more publicly because the wealth disparity that they've created intentionally, by the way, because you had the Alan Greenspan FED, you have the Ben Bernanke FED, you had the Janet yelling FED all talking about the wealth effect, and the wealth effect basically means asset price inflation and what Austrian School economists call the canceil Wan effect,

which is enormous amounts of currency and credit being misallocated. It's not going to the right places. It's being subsidized, given to large corporations for bailouts, UM, people on Wall Street to put hedge fund bets, or for bailouts, covert bailouts, and political insiders here in d C. And that's how the tax base has changed. Now here we are a

couple of decades later. And I said at the beginning of the segment that the annual tax revenues for stocks, bonds, in real estate were ten percent or less for capital gains taxes. Now we're here, we are, we're approaching, so we've had a three x move now in capital game taxes. This is all part of my stagflate tax life thesis

that I've been talking about for years. And it's just gonna get worse the government, the federal government and all levels of government because in a lot of states and a lot of counties they're going there increasing property taxes a lot too. So this is all part of inflating royal state as well. So I mean it makes perfect sense. I mean, asset prices have gone sky high. Obviously, we've seen cryptocurrencies going high. Real estate price has never been higher,

stock market has never been higher, etcetera. Um. And so then it makes sense that they're making more on capital gains, and so it also makes sense that the revenue that the government's collected off cap gains has gone from ten to thirty or whatever. But what happens if asset prices were to drop and then that revenue from cap gains drops down? Are they that dependent on that increase in cap gains taxes? Yes? Yes. And the other problem here, Mark,

is you're creating a country of speculators. So instead of a business owner, an entrepreneur or a small business owner, the citing that I want to invest in new property, plan and equipment, I want to expand my business, I want to hire employees. Instead, you have people that have some savings or capital or their retirement account. They want to go gamble on n f T s, they want to go gamble on crypto. They're not creating jobs, so they're they're the real economy, human beings who actually want

to work, who actually want to grow their income. It's not happening the conventional way. It's happening like it basically created a nation of speculators. And if you go back through financial history, this is actually looking now. Obviously things are more modern and more digital people are trading on their smartphones. But the speculative behavior is actually reminding me a lot of studying prior to the Weimar Republic hyperinflation,

the crazy amounts of speculation on stocks and currencies. Yeah, it's interesting you say that, because just this week I put out a video um I'm calling I called it Generation Gamble, which is actually from a little documentary that CNBC did, and basically it's exactly what you're what you just said there, which is we've created this generation of gamblers. And I saw that um on robin hood or or not just robbing it, but everywhere options trading has surpassed

stock trading for the first time in history. And so between options trading and what that shows is, you know, buying stocks, you're kind of buying equity, and a company, you're like buying a business. You're kind of investing in a business. Maybe there's some money going to I mean kind of supposed to be going towards a business for capital expenditure, But when you're doing options, it's just pure gambling.

And we've seen obviously, you know the rise of the cryptocurrency investing, as you said, n f T S etcetera. And and we're even seeing reports now people quitting their jobs to just be full time traders. And when you're trading options or you're trading crypto assets, you're not providing any value to the point that you're making, right, So like you're trading these assets, you're not providing any value to anything. But what you're doing is you're increasing your

dollars without providing value. But then you take those dollars and then you go buy goods and services from productive people. And so really it's this net drags drain onto the entire economy. And I was explaining this video how how this is happening and how bad it is for the society. The problem is is that I mean to explain to somebody why they should go slave over a job making twenty bucks an hour and then go flip n F T s and make, you know, fifty bucks a pop.

It is very difficult. But it's it's not you know, it's it's just a sign of the times as a sign of of where we're at, and it's a sign of what has happened with the Fiat money system. Now, by the way, you're listening to the Mark Moa show. We're talking about bitcoin. We're talking about cryptocurrencies, We're talking about the decentralized Revolution. I'm in the studio with Jason Barack. You can find them on Twitter at Jason e Berrock.

Of course I'm on Twitter at one. Mark Moss and I have him on and we're talking specifically about the problems that are happening in the financial system with the Federal Reserve and some of the dangers that are going on inside the government that I think proves the use

case and the need for something like bitcoin. When we come back, we're I want to talk about how you said that the g d P, or the gross Domestic Product of the government, is fake, and how the federal government spending is now accounting for a majority of what's put into that g DP. It's like, uh, I made another video. I said, it's like a ponzi, and you can't taper a ponzi. So we're gonna talk about those

things when we get back again. You're listening to the Mark ma Show talking about bitcoin, talking about cryptocurrencies, talking about the decentralized Revolution, and we're talking about what's happening in the government and the Federal Reserve, we're gonna be right back. Hey, everybody, welcome back. You're listening to the Mark Moa Show. We're talking about bitcoin, we're talking about cryptocurrencies. We're talking about the decentralized revolution. Each and every week.

I'm in the studio right now with Jason Barack is uh. You can find him on Twitter at Jason e back and he's uh, somebody that I spent a lot of time talking about, UM. Talking to I should say about what is going on with the FED and the debt and all these things, and so UM we're talking about before the break, we're talking about how the FED needs these asset price is to continue going up because they

depend on that much tax revenue. UM. But Jason, something else that you had told me is that the GDP, the gross domestic product that the government uses, UM, is all fake. Tell me about that. Well. Murray Rothbard, the Austrian School economist, He used to say that government spending should be subtracted from GDP. But as of as of right now, government spending, depending upon how you measure it, is about fifty GDP. Now, there is a lot of waste, fraud,

corruption and abuse here in the DC metro area. There's a lot of bribes, there's a lot of unbidded contracts, lobbying as part of it. There's also an enormous amount of revolving door corruption between Wall Street in d C. Between the regulators who want to go work at in the regulatory department of hedge funds and investment banks, big pharma,

military industrial complex. So a lot of that government spending mark is actually corporate welfare, is actually secret bailouts, covert bailouts with based on bribes and unbidded contract so large corporations. And this is common in a lot of other countries, but um here in the United States. You know the corruption levels. In the past, it was looked at as not as corrupt as other countries, but now like the

United States has emerging market corruption levels. So the the amount of government spent and the government is not going to tax itself. So if the government is spending this much, and the government is handing out enormous amounts of welfare payments, all these different social transfer payments for healthcare payments and welfare checks and ebt cards to the states, it's not gonna that stuff is not gonna get taxed. Now the

individuals who are receiving some of these things. If they based on income, they might get taxed on some of these things depending upon how much like subsidies and stuff they get. But that over the government's not paying taxes that people here in d C. I mean, I've had off the record conversations with people I've been at parties and charity events. I mean, there's lots of people here in DC that are making a lot of money and

not paying taxes or figuring out ways around it. There's that type of level of corruption here in the DC mat area. Yeah, you know, um, I I was. You know, there's something I've I was told a long time ago, and I'd always recite over and over is that the government cannot give something that has not taken um. And so in order for them to spend money, they have

to take it from somebody else. Um. Which is why you said, you know, like GDP or should be removed or government spending should be removed from GDP because it's not real GDP. They've they're basically just redistributing that money. So something that I've been kind of paying attention to is this debt to GDP level and per like the Kinsey and multiplier um Like, once you get over to GDP, UM, the more debt you have, the less growth you're getting.

And eventually you don't get enough growth out of that debt and you dig yourself deeper and deeper in a hole. And then like, um, you know, once you get over a hundred debt to GDP, then it's basically game over at that point. Now we're at over a hundred debt to GDP. But if what you're saying is fifty percent of it is phony, then we might even be way higher. Is something that you're thinking about. Well, the and this

is why the dollar hasn't crashed. You the entire global financial system, all these emerging market governments, these foreign governments, a lot of foreign corporations, they're using dollars still, they're borrowing dollar denominated debt. When the dollar index gets weak, and it got week in twenty, they borrowed even more dollars. So as long as that continues, as long as dollar denominated debt grows, the US is going to be able to get away with this, get away with stag flee

tax life for a while. Plus you have all these other governments and this is a global macro analysis. Here you have all these other governments trying to do the same thing. Um in and I've talked about this example. I've done YouTube videos on this. There's almost two thousand free YouTube videos on my channel if your listeners want to check it out. But in the Indian government last year in two run a record trades or plus. What did they do? Their central bank printed a bunch of

their own currency, Indian routpees and bought US dollars. They propped up, They helped prop up the dollar so they could run an enormous trades or plus. Now India is paying for it with a weaker currency and they're having inflation problems and um you know, the normal problems from creating a lot of currency and emerging market. But the US has benefited heavily from this dollar standard system, the world reserve currency. Plus you have with the current system,

all these other foreign governments for incorporations. If the dollar gets weak, they borrow in dollars, so it creates like this is why the dollar is basically in a trading range. And these other governments and central banks are doing very similar policies. I call it Japanification. Similar to Japan and

the United States. M hmm, yeah. And you know, I know, uh, you know, another one of my friends, Brent Johnson, he always talks about the you know, dollar milkshake theory and how the dollar is going to continue to suck all the liquidity out of all the other currencies, and um,

you know, we're we're seeing that to some extent. But the one thing that I always think about is like, Okay, that's great if the dollar is getting stronger against all the other currencies, Like that's cool, but like it's still losing ground in terms of purchasing power. Right, So it may be stronger than the currencies, but it's still buying

me less houses and less stake at the grocery store. Right. Well, the asset prices are being inflated, you have foreigners who want to buy US assets because as bad as a lot of Americans think things are here in the United States, the US on a relative basis, still has better private property rights and a lot of other countries. So there are a lot of foreigners that want to invest in

royal state here in the United States. Even though property taxes are going up, there are a lot of foreigners who want to buy U s stocks at the right valuation. There are a lot of foreigners is still want to move to the United States, so Americans have to think of things on a relative term that the US is still attractive for an investment. UM. I don't agree with a lot of what Brent I'm friends with Brent to um the dollar. He's calling for a big dollar rally.

But they Fed and the Treasury want to try to keep the dollar like in a trading range. So every time the dollar gets too strong, that basically gives the politicians, the bureaucrats, and the PhD economists here in d C an excuse to spend more to try to weaken the dollar. So that's gonna it's gonna be. I call it the dollar tug of war. So the dollar index has been

a trading range for seven years. I expect that to continue for the most part because of the way the system is designed and what all these other governments and central banks are doing. But Mark, the U S imports so many things, and that's really where a lot of this stagflation and shrink flation is coming. And I've been talking about stagg flee tax lie and stagflation and shrink flation for years. So a lot of people are talking about stagflation right now, and yeah, it's bad right now.

It's double digits right now, and taxes are going up. But I mean it's been going on for years. It's been getting bad for years. It wasn't quite at these levels. I was noticing it, but the majority of people weren't. I think what has happened, though, is that the government statistics, so like the c p I, which is a consumer consumer price index but I call it the Changing Propaganda Index, they can't hide the inflation as much as they used to,

so the average person. I'm seeing articles on mainstream financial media talking about how the CPI is totally wrong. And you know, ten years ago, we never would have seen anything like this, calling government statistics basically total Yeah. Yeah, So, UM, I want to talk more about the cp I. I know we're expecting some numbers to come out tomorrow. I want to dig into that, and UM, I have I have a couple of questions that I want to ask about that. Of course, UM, you know we need to

dig in. Uh, you're listening to the Marketma show. We're talking about, of course, bitcoin and cryptocurrencies and the technological revolution that we're witnessing. UM. Right now we're talking with Jason Barack. We're talking about the Federal Reserve, the Central Bank, we're talking about you know, the government spending and whatnot.

And the reason why is because, um, if you really want to understand bitcoin and what's happening there, you kind of have to understand what's happening on the global macroeconomic scale. I think that kind of it's one of the big reasons why this all matters. UM. So I'm in the studio with Jason Barrack. You can find him on Twitter at Jason E. Barack. UM. I think you can find him on YouTube at Wall Street for Main Street as

as well. So we're gonna come back. We're gonna talk about this new CPI number it's expected to come out, these inflation numbers, what's happening with that so we can make sure we're focused on our money and hopefully making more of it. So we're gonna be right back with Jason in a second. Don't go away, Hey, everyone, welcome back.

You are listening to the Mark Moa Show, and we're talking about bitcoin, and we're talking about cryptocurrencies, and we're talking about the decentralized revolution, each and every week, and that's what we talked about each over week, over and over and over. But we want to understand what's going on, not just from a technical perspective or you know, what's trending or whatever. We want to understand it from a deep fundamental level, like what is really uh what what's

really working behind the scenes. And in my opinion, the financial system is facing a reset about every eighty years, we see this financial revolution, the end of this long term credit cycle kind of come to an end. We're seeing the Federal Reserve running out of tools. I mean, they basically have two tools. They have interest rates, and they have money supply. Interest rates are at zero or negative in most parts of the world, and we have too much debt and their backs up against the wall.

And so I'm in the studio with Jason iraq Um. He's kind of an expert in this type of stuff, and so we're kind of talking about that to help

you understand what's going on a little bit better. Um not Jason, you you had mentioned right before the break about the c p I, which is the consumer price index, which is what the government uses to measure inflation, which is um you know, it's fine for them, But I think most of us measure inflation when we fill up our gas in our car, or we have to go to the grocery store and buy some food, UM, or buy a house. I think we've measured it that way.

But um, rumors are that there's a cd P I that is probably gonna be very bad, meaning it is going to be very high, and they're already starting to put out some warnings. I saw some headlines today saying, um, hey, it may come out and be really bad, but it's not as bad as it looks like. Have you seen some stuff like that. Yeah, I've seen a political spin from the Biden administration already talking about that. I mean, whatever the headline number is, the the honest truth is,

it doesn't matter. And I'll give you some concrete examples of that. So I didn't interview on George gam channel a couple of months ago talking about the difference in rents. So any normal consumer price index, they wait rent, but they don't accurately measure what people are paying for rents. So they don't go to the National Realtors Association, they don't go to Zillo, they don't survey a respected group of real estate agents. They don't do any of that.

And by the way, there was an article that came out a couple of weeks ago in the USA today. It was a headline. It was one of their main stories that in small cities across the United States, this is a record, first time in history, rents are up in a year. On that yeah, over thirty percent, over thirty percent. But in the consumer Price Index, the current Consumer Price Index, they use something and this is a fictional This is a fictional formula called owners equivalent rent.

It was only up i think earlier this year two point four percent, so it is off over fifteen over fourteen x. So aren't those two different measurements? Though they have the owner's equivalent right and they have rent. Aren't they two measurements? No, it's they do not accurately. So the CPI also measures for healthcare insurance. Instead of like serving people saying, my premiums are up, I'm getting less coverage,

my co pays are up. You know, going through the actual on line item expenses of people's health care insurance monthly, all the different expenses are up um, their co pays are more money, their premiums or more money, paying more for prescription medications, all these doctors business, all these things right or are up Instead. What the consumer's price Index does is it just measures Medicare and Medicaid reimbursements that are sent over from the government. So these are intentionally

made to under report inflation. This has been going on since the nineteen seventies and eighties. George Gammon did it, did a video on this, I want to say, like June or July of this year, talking about how the Federal Reserve chairman in the seventies when the stagflation started, before Paul Vulker, it was Arthur Burns. He started drastically changing the consumer Price Index, and it's only gotten worse every five or ten years. They keep on changing the formulas.

You've had people in Congress talk about it. The cost of living adjustments mark hit the highest amount I think in forty years they hit five points something five. I did a video on this about four or five months ago. But that's tens of billions of dollars more in payouts the funeral government's going to have to pay because the cost of living adjustments said that the real inflation was much higher than the consumer price index. So it's in the government's incentive to cheat, to lie for It's in

their incentive for two reasons. So one obviously is what you just said, which a lot of people probably don't catch on too. But um, if they keep that cost of living low by manipulating that number, they don't have to they don't have to increase the amount of payouts like for Social Security. So if the cost of living goes up, they have to pay out more money. So if they can keep that are officially low, they don't

pay out as much. I think that's one, and then I think the other reason, and you can tell me if I'm right here, But you know, the other reason is just if they can say that they don't have enough inflation, they can keep printing more money. Right if inflations running out, hi, they have to pull back, so it kind of gives them those to two levers. That that is definitely part of Well, they said they wanted a minimum the official FED stance a couple of years ago,

before stagflation became really obvious to everyone. In the last like twelve months or so, the FED was officially saying that they had to have around two percent inflation, and the official numbers weren't there. But again, and I'll go back to what I said earlier in past segments, it's all about the wealth effect. The FED doesn't want to talk about this publicly anymore because they created a nation

of speculators and large wealth disparity. They've made the rich richer, they've made the poor, the working class, the middle class. They made our standard of living much more difficult. So our dollars are purchasing power is going less and less. So now the Fed publicly, if you look at the speeches and the stuff they say, they don't want to talk about the wealth effect anymore. Even though that that was a sheal FED policy, there was articles that op eds.

Ben Berniki wrote an op ed in the Washington Post in November talking about the wealth effect. Your listeners can go back and look it up and read. It's on the Fed's website to talking about all the benefits of the wealth effect and asset price inflation and how it won't cause consumer price inflation. They won't have the money supply which has gone bonkers here in the United States. The Austrian true money supply, I think in the last like two and a half years, is up six point

five trillion. Kyle bassett Um. The way the broad money supply is measured is up in the last like eighteen months, So the total money supplying credit available has gone up, and that's lee and the real economy is not producing nearly as many goods as it was prior to the pandemic. So you have more currency and credit chasing the same or fewer amounts of goods, and that's why we have such bad stag stag inflation on many different items. It's

not the supply chach. It's there are supply chain problems, but there's so much current seen credit and it's chasing the same or fewer goods, right, which is in the past. High prices where the solution for high prices. So when prices go up, two things happen. One people buy less of those goods, and two people make more of those goods.

But when you have massive amounts inflation and prices go up, one the people just keep buying because they've been given so much stimulus, and too because of the inflation, it's harder for people to make more good so that it's the opposite kind of going against you, and so high prices don't here the high prices well Mark also to out to your points there, you also have politicians, bureaucrats, regulators telling business owners they can't produce, telling them they

can't hire employees, telling them they can't produce, giving them all these extra rules, regulations, red tape to maintain their business and try to meet consumer demand. So it's it's

an enormous headache trying to be a business owner right now. Yeah, I mean and and and it only further exascerbates the problem, which is people wanting to quit their jobs to become full time traders and again stopped making goods and services that would actually help the situation and instead continue to um just trade and produce no value to the world.

I agree, But unfortunately for and if you have to look at this from a US federal government tax perspective, if you work in the Treasure Department, they don't care how the tax revenues are produced. So if the government in the past, if they have to invest trillions of dollars in an infrastructure plan and they return on investment for that spending might be very low. The government might

not collect how much tax revenues. If the government doesn't have to spend trillions of dollars and all of a sudden, bitcoin goes to a million dollars, two million dollars. You have people trading cryptocurrencies and f t s, you have tons and tons, and you talked about this on your

show earlier. Taxable events, right, every time people buy something with crypto, every time people trade crypto, all these things are taxable events and the i R S. This is why on your tax forms if you're an American here, this is why there's so many questions lately asking um, are you being paid in cryptocurrency or bitcoin? Are you trading cryptocurrency? And it's only going to get worse going forward, the taxes on assets, the government going after crypto, trying

to monitor people. So it's going to be a very dangerous time for people here in the United States if you own assets and you own a business. Yeah, yeah, that's true. They're they're trying to seal off all the whole, all the holes, prevent any escape hatches, and they want to try to collect every ounce of revenue they can. You're listening to the Mark Mo Show. We're talking about bitcoin, cryptocurrencies, the decentralized revolution. I'm in this studio with Jason Barack.

We're talking a bigger picture about the FED, the central bank in the government and what that is going to do to cryptocurrencies. Don't go away, We'll be right back. Everyone. Welcome back. You're listening to the Mark mo Show. We're talking about bitcoin, We're talking about cryptocurrencies, We're talking about the decentralized revolution. You know, there's so many angles to talk about bitcoin from up and talking about it for seven years, and I don't find a shortage of things

to talk about. Because there's the philosophical side, and there's the technological side, there's the monetary history side, the game theory side, and we can go on and on and on. But one of the things I like to spend a lot of time to talking about is why why doesn't

even matter? Um solutions are supposed to come to problems, And we have a lot of problems in the financial system today where at the end of a long term credit cycle, the reserve system, the dollar system is starting to crack um and and the ship is starting to kind of sink, so to speak. Now, I'm so I'd like to take a look at those the kind of bigger macro side I'm in the studio with Jason Barack. You can find them on Twitter at Jason ib iraq, and we trade a lot of messages back and forth.

He's an expert in these things, and so I thought i'd bring them on. And Um, Jason, you were making the case before, how um, you know fift of the g d P is kind of fake. Um, they're basically taking money and spending money on themselves, but it doesn't go back into being a productive piece of the economy. But you're also talking about how they need asset prices to continue going higher because of the capital gains taxes that they're making and how much of a big piece

of the budget that is. And if asset prices go down, cap gains taxes go down, and then their budget goes down, that's a big problem. But what about, um, what about all those asset prices staying high because they're collateral and so the whole system is so levered up that you know, the real estate and the stocks, etcetera makeup collateral. And if the markets start dropping, collateral starts drying up, it could turn into this entire cascading effect. What do you

think about that? Well, yeah, you start getting margin calls. Look what happened in the last week with the VIX. The VIX hit thirty early Monday morning, and then it was monkey hammered back down with manipulation from one of the four or five or six different plunge protection teams. Within about forty hours, it was knocked back down to twenty. And that's because of the leverage short volatility trade that's over three trillion in size according to volatility hedge fund

manager Christopher Cole. That means that when the VIX starts going up, all these portfolio managers at investment banks that trade tons of bonds on leverage between seven x or more. Some of them are ten x or more leverage. The family offices like archegos, and there's a lot more family offices that copycatted the same or similar traits to our chegos and hedge funds that are over leveraged. So yeah,

that would cause temporary deflation. But Mark, I've been in the financial industry now for my fifteenth year, will be next year in two working different jobs in the financial industry, and I could tell you that FED policy they will

not allow deflation for long periods of time anymore. There will be rules changes, there will be bailouts, there will be goal posts moving, there will be secret bailouts, there will be press release manipulation, announcing as many liquidity programs as possible to prevent these asset prices from staying too

low for too long. So in two thousand eight, two thousand nine, we had low asset prices, we had UM low asset prices and quote unquote deflation according to the government statistics, with UM money and credit dropping for maybe six to eight months. In February and Arch of we had deflation for six to eight weeks. So perspective here, we had deflation in an over leverage system, where in my opinion, mark the entire system, now, the global financial system.

We're over three hundred trillion now in total government debt and and UM corporate debt, and it's it's just keeps growing. It seems to grow now by twenty trillion now every twelve to eighteen months, twenty trillion or more globally, so even more debt is added. And yet the current debt can't be paid back, the current debt can barely be serviced. So this system is a Ponzi scheme. But the government

can't tax deflation. So that's why the government one of the main reasons why they won't allow deflation, even though um, if you're an Austrian school economists, that might have been the cure. But the current system, the people in power, the policy makers at these central banks, they won't allow deflation for a long period of time without changing the roles, bellouts, manipulation, all these and things. So what does that mean? They won't allow deflation. I mean they won't allow the markets

to ever drop again. Because I know a lot of people, including myself, uh, we're expecting you know, this big, this big market crash to come. I've started to kind of change my mind on that, maybe to kind of what you're what you're saying, But what what do you mean? They won't allow asset deflation, so they won't allow it, Uh,

the caveatists for long periods of time. So look at the desperation, all the crazy announcements the FED had to make during the span of February and March to try to restart bond markets all over the globe, to try to restart credit markets in the US and all over the globe. Wall Street banks wanted to restart selling junk bonds, collateralized loan obligations, leverage loans, all these credit and derivatives products.

Wall Street love selling this crop. The bond salesman on Wall Street, the hedge fund guys that go on Real Vision TV and and talk about their ball on trades blah blah blah, their leverage bond trades and out which they are. They love selling this stuff. And during a deflationary period they can't sell the stuff. So there's a bunch of different reasons why the federal government, the Federal Reserve, the US Treasury does not want to allow deflation for

long periods of time, and they're going to change. They'll change the rules a whole bunch of times. Unfortunately, the average person, mark the retail investor, the average person does not want to hear that the rules could change next week, a couple of weeks from now. After that they can change a month from they could keep changing. The average person does not want to hear the goalpost move. They moved again. The average person does not want to hear this.

When I talk to investors and other people, they want a easy solution to a very difficult problem that unfortunately, right now does not have a solution. And the problem is the policymakers, these politicians, bureaucrats, regulators, central banksters, they are doing really stupid things and it's continuing. And that's why you have all these traders. They're gambling that they're going to get a bail up. They're gambling that the FED is going to change the rules, and they're not

going to go to prison. They're not gonna lose their jobs if they have a margin call and their hedge fund gets shut down. Okay, twelve months, eighteen months from now, they're going to restart. It's gonna go right back to selling junk bonds. And that's why corporate debt has doubled since two thousand nine. Corporate debt has doubled, cash flows haven't doubled. The money hasn't been um invested properly by corporations, has been used share by backs on debt and increasing dividends.

And by the way, dividends marker um. The average retail investor doesn't think about this. Dividends for an American investor are triple taxed, so corporations pay their corporate profit. Corporations pay taxes on their dividends before they pay them to shareholders, and the shareholders pay their dividends, so the average person does not think about any of this. The government loves asset price inflation and that's why the policies like this.

So so we can have we can have deflation, we can have deflation, but it will not last at this point. I'd be shocked if it lasts for more than three or four months at this point, because that's how ridiculous the system is. The system is a currency and credit

Ponzi scheme with government debt in corporate debt. So you're basically saying, if we see a dip in the markets, um it would be very short lived, which would then be met with an enormous amount of central bank manipulation to push the markets back up to new all time highs. So if the FED does not want to do that,

then the FED. If the FED does not want to do that to help the U. S. Treasury with capital gains taxes, then what the Fed's gonna have to do is they're gonna have to buy either They're gonna have to cover all those lost capital gains taxes that the Treasury was bringing in. The FED would have to mount the FEDS trapped. They don't want to make this the

fedest trapped. The balance sheet is not going to go down significantly really ever again unless the US government drastically cut spending or the US loses world reserve currency status in the near future. Yeah, got it. So the FED would have to cover the losses all these capital gains taxes that the and and trust me the Treasury now and i've and I've seen President. Have you been to

the DC Blockchain something yet here in d C? You should come if they have an in person one at Georgetown and listen to people from the U. S. Treasury, listened to people from the Fellow Reserve, listen to people from the Securities and Exchange Commission and seef TC speak at the event. They've owned bitcoin for years. They love bitcoin. They buy bitcoin for family members, but they want to tax the crap out of it too. They want to tax and regulated, which is which is fine. They can

tax it, just pump it to the moon. Hey, that's that, thanks so much man. So uh you heard it from from Jason Jason Barack. Find them on Twitter at Jason E. Barack UM. If you like this kind of content from him, you can follow him on Wall Street from main Street on YouTube as well, And uh, that's it. I don't know, the markets aren't. The Fed can't let the markets crash. That means more stimulus. That means your dollar is going

to continue to lose purchasing power. That means you need to continue to find ways to maintain or increase your purchasing power, which, of course bitcoin is my favorite option. And that's it for today. Thanks for listening.