Why the Federal Reserve Has No Control Over the Markets

It's completely out of their control. And he's not just nobody, he's one of the most respected voices when it comes to the US dollar and the bigger problem, which is the euro dollar. I'm talking about Jeff Snyder from Your Euro Dollar University podcast. He's also with Markets Insider pro

and Portfolio shield dot net. And we talked about why he says the Federal Reserve has no control over the markets, why the story of Paul Volker under Reagan hiking interest rates to tame inflation is a complete myth, how it had nothing to do with that. We're gonna talk about the reality of inflation and the FED having no control to affect that. We're gonna talk about what the end game of all this is what he thinks happens. In

his best guests. Of course, we're gonna talk about sound money, We're gonna talk about bitcoin, We're gonna talk about uh reasons why it may or may not work, what happened throughout history, so many more topics with the absolute legend. Jeff Snyder was an amazing interview. Let's go ahead, just jump right into it. Jeff, thank you so much for your patients, and I appreciate you showing up today. Big fan of work. I'm I'm excited again here Mark, thanks for having me on. I love the set. It looks

absolutely terrific. Thanks. Thanks. Yeah, it's my first year, my first guest with the new set here. So um uh our guess about a month ago we were both speaking at a mutual friends conference, George Gammon's conference, Rebel Capitalist Live, and you gave a great presentation. I took a lot of notes, um, and so I've been excited to talk

to you ever since. And Um, the thing that you were talking about, and I think that you're a little bit mad about and they want to scream to the whole world about, is that the Federal Reserve has no control. Is that right? Yeah? If you want to boil it down into a single idea. That's probably the best way to describe it. So the Federal Reserve is UH, I think at the time of this recording, which by the way, is UH July. I think the tomorrow they're expected to

come up with another rate hike. The markets are betting it's going to be point seven five. Some people think it would be be one point Probably doesn't really matter either way. It seems that since they've announced their rate hikes in November of last year, the risk on assets sold off first. We saw the NASDAC and bitcoin kind of sold off the same day, SMP lagged. Um. It seems like their rate hikes have caused a lot of problems in the markets, but yet they have no control.

So maybe he kind of frame that up for us a little bit. Yeah, And I think that's the issue, is what control do they have? Control is probably not the right word. It's more of like more like along the lines of influence. And so if you look at what the FET actually does, let's just let's just get it all the way from the beginning. They don't print money.

There is no money printing. They create balance sheet space, they create bank reserves, but many people believe they print money and as long as people believe they print money, they act as if they have. And one of the ways that that manifests is in the financial services industry

in certain asset markets. For example, in when J. Powell got on TV and told you he lied to your damn face and said that he printed digital dollars and flooded the world with him, that was a message he intended to send to asset managers to say, I've got your back, don't worry about it, no matter what's going on in these dark, dark times of COVID, the Federal Reserve has got your back. If it doesn't have your back, but if enough people actually believe it, it becomes a

self fulfilling prophecy. And so risk managers by risky assets because they think, well, hell, J. Powell is doing something. I don't know what he's doing, but he's doing something. So therefore I have I can call my clients and tell them we're buying stocks and we're buying risky assets because the FED is doing some stuff. And so that's

what happens the FED. The FED has it a sentimental effect or a psychological effect, primarily through the financial services industry, but also in other places, and then you get to November of one where the FED says we're not going to do the same stuff we've been doing before. Suddenly financial services managers they don't have that protection, they don't

believe they have the same protection from J. Paul. So you have that sentimental effects start to reverse and it becomes self fulfilling and self realizing in the the opposite direction and the from the way that it had had gone in one. So without the ability to feel like J. Powell has got your back because are gonna be hiking interest rates and they're gonna be cutting back and scale it and running off their balance sheet. There the FED

isn't isn't my buddy anymore. Suddenly asking assets look a lot, a lot more risky than they had before. So this is one area where UM, I have a little bit of disagreement with UM a lot of economists, UM, because I think they can be factually correct, but maybe a little intellectually dishonest. I don't know if that's the right way to say it. So, UM, you talk about they didn't really do anything, but they had a psychological effect, Well that is something, all right. So then then it's

like you're starting to split hairs. Um. At George's last event, he had a professor. Uh uh, I'm drawn up like now the German uh economist who does all the talks all the central bank stuff. Uh is it Wolf anyway, I'm dronna blank. Sorry. But he gave this great talk about how all this central bank printing through two thousand eight and wasn't inflationary. But I said, but stock indexes are up at all time highs and and house prices

are altimized. Well, that's assets, that's assets, that's not consumer prices. And so it's like it's kind of like splitting hairs a little bit to me. No, but there is a real monetary issue there, and the real monetary issues that the credit creation that underpinned or supported the previous housing bubble and the credit bubbles of the pre crisis era just disappeared. So what happened in asset prices post crisis was I mean, you can call it inflation if you want,

I don't really care. There was definitely an effect there, but it was non monetary. Was something else entirely. So the real economy has been deprived of credit and money, even if asset prices have done really well, certain asset classes obviously done better than others, which has only led to more problems because you have stocks, for example, at all time highs, or they were at all time highs not that long ago, while the economy is in the toilet, and not just in the US, all across the world,

the economic growth has fallen off substantially, not coincidentally, ever since this credit credit machine broke down more than a dozen years ago. So you have the psychological impact where there is less friction for psychology to work in certain asset classes and asset prices all based on a misconception of what it what it is the Federal Reserve does,

so it's not really spitting splitting hairs. It's a categorical difference that explains a lot about explains everything about the world that we're actually living at why everybody is so damned piste off about everything because you have the rich people getting richer and the poor people can't find a job. And that's really the issue here, is that without monetary growth,

without credit growth, the economy stuck. And no matter what the Federal Reserve has done over the last twelve years, it's not just a fed the ECB, the Bank of Japan has been doing it has been failing even longer with their psychological manipulation tactics. It hasn't worked there either, So you have a divergence between what the real econo of he's doing because psychology doesn't work in any any

real sense. It does work in asset markets like stocks, because there's no real fundamental tie to any tangible asset or in tangible outcome. So again you have this major divergence between where assets went where the real economy went, which is nowhere. Good. Well, let's let's and let me talk about one other things. You said that they don't

actually print money, which is true. So the Federal Reserve gives banks reserves and they set the interest rate, but the bank charges their interest rate on top of that whatever they want, and they can decide whether they want to loan money on or not. Right, So I think that's kind of your point. Right. However, um, through the bank's reserves and through their MBS policies and stuff, they take toxic debt off the books and then replaced No. No,

see that's the thing. That's another misconception. That was not buying. I mean, the FED buys us treasuries and nbs, and then they're not buying subprime mortgages. They're not buying subprime mortgage bonds or leverage loans or some other financial products, certainly not buying clos like they've made people believed either in March, the FED is buying assets the market already wants. In fact, the FED knows this. They talk about it

all the time. The fact that you know famous quote from Richard Fisher in two thousand eleven, and why are we buying assets that the market is fleeing toward? Central banks are supposed to be buying, like you said, they're supposed to be buying toxic assets that people don't want. But that's not what quantitative easing has been. It's not what quantitative easing has ever been, which is one reason

why it doesn't ever work. And really, you know, we stop and think about what QUEWI is supposed to bes and as opposed to what it actually is. Everybody looks at it from the perspective of the federal reserve. What is the FED doing when you need to look at it, as you just said, Mark, from the perspective of the commercial bank. You can create all the reserves in the world that you want. But if banks aren't going to be lending, it doesn't matter. That's just an accounting fiction

that's created by monetary policy. Think about it this way. Before, before Lehman Brothers in two thousand and eight, there were hardly any bank reserves in the in the entire global system that spans trillions upon trillions of dollars, there were no bank reserves. Yet credit was created. We had asset bubbles through the roof. You had all sorts of money everywhere around the world with no bank reserves. Suddenly we

get to the other side of the crisis. There are trillions and bank reserves, but no credit girls, no expansion, no money. How is that possible? Because the FED isn't creating usable money. It's responding to breakdowns in the actual monetary system through this psychological tactics, through the through the act of buying bonds that the market already wants anyway.

So the way that you were explained to me, though, it sounds like there's direct and indirect influence the FED has so a lot of times I think maybe you're saying that. So, look, they didn't do anything. They said they're gonna do something but they didn't do anything, so there was no result. But at the same time, just them saying it, or sometimes we might call it job owning actually does do something. Would we agree on that they kent? Yes, And most of those psychological impacts are

sentimental impact acts are short term in nature. They don't have a lasting impact certainly in any real sense. Asset prices a different thing. Uh, certain asset markets is a different story. But in terms of the real economy, there's

really not much impact whatsoever. Okay, Now, Um, another thing that you had talked about at this at this event to the Rebel Capitalist Live, you talked about the Vulcan myth, and so everyone is wondering, now if the Fed can, if they'll have the stomach to tame inflation, will they raise rates high enough to stomach, you know, to to to finally put an end to this high inflation that

we have. Um, like Vulker did in the eighties where he went from ten um and you had a whole piece saying that that was a complete myth, which continues to back up what you're saying and why the Federal Reserve really has no controls. So let's talk about that Vulcan myth and why you think that actually isn't true. He isn't the one that stopped inflation. If if I'm

saying that right, if I'm not putting words in your mouth. Yeah, that's where the Volker myth actually comes from, the idea that it was Paul Wolker who skyrocketed interest rates in seventeen starting in nineteen seventy nine, and that's the reason why the great inflation suddenly stopped. And the funny thing is, if you had if your time travel back to nineteen seventy nine, he would be shocked. And by he, I mean Paul Woker. They had no idea what they were

doing in seventy nine. And this is not something you have to take my word for it. I gotta do is read the transcript from the FOMC meetings at the time. These people had no clue what they were doing. And the idea that Faull Volker raising rates, that's not what

he did either. But the idea, the idea of the myth that he raised rates and tame Great inflation UHS was something that was invented afterwards to try and explain what happened in late from the late seventies into the middle nineteen eighties, it was sort of like, we have

no idea what really happened. So maybe it was this thing that Vocer did that created this the end of the Great Inflation, And that's been the myth that we've been told that was reinforced through the quote unquote great moderation by Alan Greenspan, the Maestro, all that stuff in

the nineties and into the two thousand's. But if you actually go back and look at what happened in the late seventies and early nineteen eighties, it was a whole bunch of clueless bureaucrats just throwing ship at the wall hoping something stuck. So why did he raise rates so high? Because I didn't know what else to do. Paul Voker, you gotta give the guy at least some credit. Unlike his predecessor, Arthur Burns, Voker at least knew that the

Great Inflation was tied to the money supply. Burns with thought it was fiscal deficits. He convinced governments. He went off into a neo Kenzie and Funk, And so you know, the Federal Reserve was looking in the wrong place. For the reason why inflation was so out of control, as Milton Friedman said, As Milton Friedman showed conclusively inflation is always, at everywhere a monetary phenomenon, so at least Volker Volker

at least knew that much. However, his plan to stop inflation was sort of a we don't know what else to do because the federal reserve. All we have in our toolkit are these bank reserves, and bank reserves have a very narrow limited use, which is you have a reserve requirement that's imposed upon the banking system by governments. And so what happened. What the theory was was that if the Federal Reserve undervoc or made bank reserves scarce, he would make bank reserves expensive and the bank the

bank reserves became expensive. That would make depository money expensive. Because if you're a commercial bank and you create a loan in a a corresponding deposit money liability against it, that creates a reserve requirement that you must meet, and you have to you can meet it through vault cash, or you can meet it through bank reserves held it the Fed. So the idea was, if we make bank reserves scarce, that will make that will increase the cost.

The rate will go up, as it did, the federal funds rate will go up, and that will that will then make banks reconsider their creation of loans and depository money, therefore restrict economic activity, and that's the end of the inflation. That's not how it worked. First of all, the Federal Reserve panicked as soon as they started this, this restricting

reserve regime in nineteen seventy nine. Immediately the federal funds rate skyrocketed to more than which nowadays people think, well, yeah, that was the point, But no, at the time they panicked. They actually did a repot programs starting in October of nineteen nine to put reserves back into the system because

they thought they had gone too far. But either way it didn't matter, because no matter what the Federal Reserve did in terms of depriving the system or not depriving the system of bank reserves, it had no impact whatsoever on depository money, had no impact on M three, had no impact on the real money, which is the shadow money across the Euro dollar system. That's not what happened.

So after it became clear that restricting bank reserves was having no effect on either monetary aggregates, or the real economic outcomes. They sort of invented another kind of myth, which was that, Okay, maybe restricting bank reserves didn't cause the end of the end of the Great Reflation. Maybe it was the collateral consequence of having interest rate rise, the federal funds rate rise, that had some kind of impact that we can't explain because it didn't have any

kind of monetary impact. It didn't impact the monetary system whatsoever. So maybe the fact that interest rates short term federal fund ray in particular one up. That's the reason why the economic outcomes that we all wanted ended up happening. It's simply looking at correlation and implying causation that isn't actually there. Because again, the FED at the time realized they couldn't even define, let alone measure, let alone control the monetary system. Now, uh, let's jump I want to

talk about where we're at today. But before we jump to there, um and I guess the part of the reason why you say they can't really control the monetary system is that the FED only can control basically the dollars bank reserves. That's it. That's that's the one tool

that they have. And in the nineteen seventeen. Before the nineteen seventies, banks invented ways to circumvent the reserver fronments invented new ways of doing monetary transactions, things like repo, things like eurodollars, things like currency swaps, that they could just manipulate both the asset and liabilities side, regardless of

whatever constraints that FED tried to impose on them. And in fact, that's one of the things that happened in ninety The FED tried to make these reserves expensive, therefore making depository money expensive, and so banks just encourage their customers to shift their assets from their deposit accounts into

money market funds. Money market funds don't have a reserve requirements, and so they went into so as the customer deposits moved from the commercial bank that created this reserve requirement, they moved to a money market fund. The bank was done just borrow the funds back from the money market fund.

In wholesale markets. Banks had created all sorts of ways to be able to manipulate their assets and liability these monetary forms that just rendered the federal reserves tools completely obsolete, except for if they don't believe the Fed's going to be find them supporting them, then they'll get into they'll get out of those risky assets, which is where we're at today, which is a completely different animal. It's a different animal. So the tools that they're FED is using

don't really do much. But the support that the psychological effect of the support, either having it or not having it, does have an effect in yeah, in certain markets. It certainly doesn't have any impact in anything that has a fundamental link to the real economy. So fixed income you don't see any real psychological impact from the FED whatsoever. It's really about manipulating the short end of the yield curve and hoping the rest of the curve goes along.

So we've seen the FED hike rates over the last few months. The short end of the yield curve goes out, because of course it would if you're owning a two year US tragedy for example, if the FED is hiking you know these reverse repo rate, you have an alternative rate that you can get a return on. So the FED is able to influence the short end of the yeel curve, but even that is somewhat illusory because over

time they lose control. Really really quickly too. And that's that's assuming that the long end of the Yolk curve actually falls in line, which as we see now that's not the case either. That's why the curves are inverted because the long end of the yeld curve is fighting against the Feds, right heikes at the short end. H Yeah, Now, um,

the the yield curve is gotten pretty screwed up. I mean, a lot of this, I would imagine has to do with the continued manipulation they have with printing more currency and manipulating the their FED funds rate. At some point, because it's been accurate predicting recessions, which I guess for the for the White House, we're not in a recession anymore technically they've changed, true, but the recession is still coming. Okay, So the yield curve is predicting that there's a recession coming,

and it's been predicting that for a while. Right there. Yield curve was predicting that since two thousand nineteen. Well, the yo curve predicted the recession that probably would have happened in two thousand twenty had it not been for COVID. So the yel curve had inverted in twenty nineteen. In fact,

parts of it inverted as early as eighteen. Your Dollar futures curve inverted in June, which was a bet that the Fed was going to end up cutting rates before they continued hiking rates, which is actually proven to be true. These markets have been have proven in general terms, incredibly

accurate over each of these particular cycles. And so the your Dollar futures curve inverted back in December of last year, which was a bet despite the feds ultra hawk is stance and growing ultra hal care stance that eventually the FED was going to have to stop hiking rates and maybe start is turn around and start cutting them before the FED realized it it. Ever, since December, the inversion of your at All the futures has grown to two

thousand eight proportions. Uh. It is comcredibly inverted at the as we speak right now, which is the market betting that the FED only has a couple maybe more rate hikes left this year before something happens. We don't know what we can guess before something happens, and the FED has to turn around, stop hiking rates, and turn around

and start cutting them aggressively. Maybe as soon as this year, probably next early next year at the latest, and then the Yeal curve is essentially agreeing with the premise behind the rod dollar futures inversion, which is that there's probably something like like recession, if not nasty recession, still in

front of us. So think about it that way. We've already had two straight quarters, likely we'll find out Thursday, but we'll likely have had two straight quarters of negative GDP to start the year, and the markets are all uniformly saying, that's not the thing we're worried about. We're worried about what comes after. We've already had a technical recession,

as so many you believe that that's the definition. So the markets are all positioned for a deflationary monetary condition on top of what might be a pretty nasty recession too. When you go back and and look through history, which I know you have many times, um, it seems like it's not the it's not the reversal. So when they've been lowering lower and lower and then they go back to raising, which they're on right now, it's when they reverse back off of that which seems to be kind

of the trigger. Is that kind of what you're saying, the markets are kind of seeing that in the in the in the forefront, and that's the trigger that they're aways the longer, longer to these curves are simply ignoring the Fed entirely. What the you know, Irving Fisher decomposition of yields into growth and inflation expectations. A longer long end treasury yield is essentially building upon the short end interest rates, so the money alternatives, but then implying growth

and inflation expectations on top of them. And so what the what the curves are telling us, and they have been telling us all years. They disagree with the very premise behind the FEDS rate hikes to begin with, that the economy is not overheating, the labor market is not in any great situation, and that the rate hikes to quote unquote end inflation aren't necessary because the recession that the market is afraid of is the instrument that will

end inflation, that will end consumer prices. It will likely result in renewed disinflation, if not deflation, at least in the intermediate term. So the markets, and especially along into the curves, outside of the Fed's window, out of the same thing with your or dollar futures that the markets have been betting against rate hikes from the very beginning. M Now, I want to get into this end game,

the few hikes before it breaks. You said, we can guess at what breaks and what we'll get back to that. But um, you had also talked about how really what we have is a problem. Um that that signals these uh, these crashes, these recessions, is these dollar shortages that happen all over the world. And I think that's probably we're at. We'll have a dollar shortage right now, which is why the Dixie is shooting so high. So explain this dollar

shortage over the world to us. That's the hardest part for people to come to terms with because, as you said, Mark, I mean, you see the Fed's balance sheet go up. You see there's trillions upon trillions of bank reserves, and you assume the bank reserves are useful money. In fact, some people call them base money. And if you see the Fed's balance sheets skyrocket, you see all these trillions of reserves suddenly appear out of thin air. You think

a lot of money has been printed. So how in the world can we possibly have a dollar shortage when the FET has created all these dollars. And the answer is simply when you realize that bankerserves are not useful money and the FET is simply created there just a byproduct of quantitative easing, UM, then you can okay, the FETE isn't part of the monetary system. Bank reserves are not really useful money. What actually is useful money is telling you that there is nothing. There's a dollar shortage,

and it's getting worse and worse all the time. And we see this in any number of ways. UM. We don't have any direct insight into the uh Euro dollar system as a whole, but these markets, these curves, you know, the tarasury market, German global bond markets, UM. The dollars exchange it's a good one too. When the dollars exchange values goes up, that's a bell weather for global financial conditions. In US dollars, it's telling you there are not enough dollars.

The price of participating in the global monetary system has gone way up because there aren't enough of them available to be used around the world. So we see all of these signals from the monetary system itself telling us there must be a not a dollar shortage, but not just a dollar shortage, but growing in a more severe one as we go through this year. That's why these curves are so distorted, so inverted, because the markets aren't

just thinking about recession. They're thinking about what happens when you have a recession plus a possible deflationary breakdown in terms of another monetary event like maybe March of maybe something on the lines, not in the same way, but something similar to the two thousand eight crisis. We want. We're not gonna see banks failure. We're not gonna see bank failures and banks failure like they did in two

thousand and eight. But that doesn't mean we can't have a liquidity squeeze or a deflationary monetary event of similar type of proportions. So the markets are worried about this already. They're telling you from inside the monetary system that there are not enough dollars around the world and has nothing to do with the Fed. It's all about the monetary system itself. Now, when you say the bank, the FED gave bank reserves, which is not useful money, Um, does

it give them confidence? Is that an indirect benefit to the market. Does it give the banks confidence to loan more money out. It doesn't. I mean it does for portfolio managers looking to buy stocks. That has absolutely no effect whatsoever on the actual banking system and credit creation. And this is, you know, quantitative easing is the most empirically tested program maybe in human history. It's been used over and over and over again, and the the results

are uniformly the same. They're just not what you hear on on mainstream media. And again you don't have to take my word for it. Just read the academic scholarship that's been written by the QWI people themselves UM Bank of Japan. A number of studies that have shown quantitative easing has no effect in any of the three proposed channels that it's opposed to. The Federal Reserve studies the

same thing. The last study I think from the FED UM or maybe it was a researcher associated of the FED, I forget, just going off the top of my head, they said that a six hundred billion dollar QUEI program that targeted specifically U S Treasury buying would we maybe should expect about fifteen basis points of effect on the ten year U S treasury. Think about that six hundred billion in treasury buying lowers the tenure treasury by fifteen

basis points. That's basically a rounding error if it's statistically significant at all. So what I'm saying is that quantitative easing has no effect on the real economy because it has no effect on banks. The banking system is constrained by its own internal as well as external parameters that

have been doesn't matter what the FED does. There's no no amount of jab booning or psychological manipulation or you know, the FED being your best friend because it's buying bonds has been able to get banks in the US, in Europe, in Japan for thirty years out of the same rut. Credit creation does not correspond to bank reserves or federal reserve policies, which is the very lesson that Paul Voker

learned forty years ago. Bank reserves just don't care. If banks want to do something, it doesn't matter if they have reserves or not. They'll create the liquidity to do it. It's really about the commercial banking system. So, um, so if if quantitative easing isn't inflationary, and what I'm trying to do is I'm trying to um I understand the academic and factually correct argument. But then like what does it mean to the average person? And so like, how

do we see this? So since two we've had massive QUEI for the last decade or a dozen years, and we've seen stock markets and and real estate go to all time highs. And so even if that hasn't affected the commercial banks to create more money, um, has it led into a wealth effect Where my stock account, my retirement accounts higher, my house is higher, I spend more money. That's inflationary. Today we're seeing the opposite of that, even

though they haven't really done anything. People feel less wealthy today, they're spending less money. So if we if we if we don't look at just the purely you know, like I said, um effects, or if we take the total effects together, I mean, is there some causation or correlation there? There should be, And that's one of the theoretical channels

for quantitative easing. And that's one of the reasons why the Federal Reserve and all central banks pay attention to the stock markets because they believe they can manipulate stocks and they're correct about that into creating, as you said, mark the wealth effect. But there's no correlation between the stock prices and actual spending in any in any economy. It's simply a theoretical idea you talk about academics. The wealth effect is is more of an economic idea than

any real phenomenon. There's no evidence for it whatsoever, And of course why would there be, just because that's your your four oh one K goes up. You can't spend a four oh one k until you actually retire. But now you might think, well, my four oh one K is up, so I can spend other money because I don't have to save it. But that doesn't happen. There's

no evidence, there's no data the shows. And first, and more than that, the economic growth since two thousand eight, since the FEDS started on quantitative easing, has been materially different than it had been before the precrdy. Materially different, I mean much much worse. So if there is a wealth effect, then it is is not only undetectable, it's led us into worse situations than we would have been had nothing happened in two thousand and eight. I I don't know if I agree with that, and some of

it is just gut right. So like myself included like I'm not going to retire for a long time, but right now, the way the markets are right now, like I'm second guessing vacations, I'm second guessing added onto my house like I was going to because like, oh we, like you said, the Yolk curve showing there could be something there, I'm spending less money. So how do we measure that? I don't know, but I do know there

is some measurement. So for example, we saw last year, we saw record amounts of job quits, record amounts, and we broke it month after month. And why were those people quitting jobs? Well, a lot of polls should they were going to trade options on robin hood and trade cryptocurrencies and so that, Yeah, that did cause a wealth effect, and that wasn't measurable, right, And that's an anecdote. It's not acttionally that Okay, Um, yes there were you know.

The sad fact of the matter is the labor market is not as robust as it would seem from that metric because according to the Establishment Survey or any of the survey the labor market that data, we have fewer jobs today than we did in February. Um, so you can blame that on the Great resignation and so called Great resignation, but it also could be and I think

it is consistent with what markets are telling us. Not stock markets, but other markets are telling us that there was no wealth effect and that we're picking and choosing anecdotes that fit preconceived narratives, the idea that the FED created this bubble, when the FED really didn't do much of anything. The real economy suffered for the breakdown. I mean,

of course it did. We put how many small businesses out of work are out of business in Do we really think that we're going to have a robust recovery from that just on that alone, um, And so that's what the markets are telling us, and that's what the data tells us. With the fact that we have fewer jobs, the participation rate took another leg down. These are similar types of results that we saw in the aftermath of the first financial crisis in two thousand nine and two

thousand ten. So what we're seeing is that that process is being repeated for the second time. And so some of these other ancillary anecdotes are just inconsistent or seemingly inconsistent with the data, which tells US. There was no wealth effect. There's no widespread wealth effect. It certainly had an effect on certain certain proportions of the population, but that wasn't enough to create an overall environment that was

actually consistent with a booming economy. Yeah. I know, with these complex systems, it's it's hard to like pull things out. But like say, let's say, for example, supply chains have been overtaxed and we've had massive supply chain problems. Everybody knows that. Now why, Well, there's a there's a trillion reasons why. But one of the reasons why is excess demand, and one of them is not enough product. Right, So supply chains broke down, COVID shut them down, turn back on, etcetera.

People quit. There's all that. But I look at some data that showed that our imports had were twenty sent more than they were previously on average, So we were buying more stuff. We were ordering more stuff. I know people with in industries, Um, how are there There's record sales in outdoor equipment and products and things like that, So, um, there were record amounts of buying. We did order more stuff, which overtaxed the supply demand equation of the equilibrium of

the supply chain. So there was some of that. We can't quantify that, no, we can, but that's a that was a reallocation of resources. Because Americans were locked in their homes, they went not spending money on Amazon, which meant we were buying goods from overseas producers. That only made things worse because we couldn't move goods around. As you said, Mark, there was supply bottlenecks and things like that.

But what people don't realize is that as Americans were spending goods and record amounts, that's absolutely true, in record amounts on goods, they were not spending on services. So the goods economy made it seem like everything was terrific, if not overheating. But then you look at services that forgotten as the forgotten part of the whole thing because

it's not sexy, because it wasn't exciting. We've spent less on services over the last couple of years than than and and before we're in real terms, the spending on services is still not back where it was before the COVID crisis. Let me say that again, we're two years later, we're spending less on services than we did before the before the recession. In so if you look only at goods, you look only at the prices of goods, it looks

like the economy went completely crazy. Because it did. It was insane in that one part of the economy, but the rest of the economy, which explains why job creation hasn't been as robust as some of the numbers make it seems because the whole economy, the entire system as

a whole, didn't really recover. So what happened in one as the demand curve was artificially shifted to the right, it was only artificially shifted to the right for part of the economy, and so that created the imbalance, a reallocation imbalance that led to consumer prices going up, in oil price and gasoline, everything else that you just mentioned. That exacerbated supply problems from the pandemic and everything else, shipments,

logistical issues all over the economy. But it didn't address the lack of spending, the really seriously serious and alarming lack of spending on the services. So if you look at those combined and aggregate, we didn't actually increase that much. That would just shifted from you if you actually draw mark, if you draw a line from you know, where services or where personal consumption expenditures as a whole, goods and services together would have been had there been no great

no COVID recession. That's right where we are right now. So essentially all the money that was spent on goods that would have been or all the money that would have been spent on services was just spent on goods for a while. Okay, I was going to ask you about the endgame, which you had alluded to. You think there's potentially a few more hikes coming before something breaks. We don't know what it is, we'll guess, and then

the reverse course. I'm gonna come back to that in a minute, but before we jump into that, I want to talk about this inelasticity of the money supply. So you talked about one of the failures of gold, specifically going into the Great Depression, was that the inelasticity of the money supply and then the need to kind of put the credit on top of that. Um Am, I framing that up correctly. Yeah, what you've seen throughout history was that in elastic money supplies always led to periods

of hoarding. Well, first you got risk taking, bubble type behavior, that eventually leads to hoarding with no ability to have elastic money supply. That causes bank panics, destruction, economic destruction,

demand destruction, deflation, and then depression. That happened repeatedly throughout history when whenever we got into these uh, these deflationary periods, and that's the reason why many countries turned to central banks, hoping that a public utility could provide an element of elasticity. Of course, that that didn't prove to work very well, certainly in the Great Depression with the the brand new Federal Reserve only fifteen years into its history and it

leads to the worst economic calamity in history. So that didn't really settle the elasticity question either. But that's still in a fixed money or hard money system, we always have this defect where it leads to pooling and hoarding that produces some of the worst economic consequences. Well, it seems though to me, is that it's one I would say, booms and bus are natural part of the world, right, we have seasons in life, and we were we're humans

and so um we like neon colors and none. Next thing you know, they're out of fashion and we just want white and black for example, right, and people made too many of the neon clothes, and then fidget spinners are popular, and then people bought too many fidget spinners,

and like it just happens. Right. So there's like natural cycles, and it seems like it's the creation of the money supply that creates this this artificial boom, and then it's the restriction of the supply and not continuing to grow at the same pace, almost like a Ponzi scheme, that

then seem to crash it. And so maybe on a hard money system we would still have booms and bus which we've seen throughout hundreds of years of history, but those booms and bus are small in comparison to the ever growing booms and bus that we have now under these artificially stimulated bubbles. Yeah, I don't that's a tough question. It's in some In some ways it's a counter factual because you can't go back and redo historical depressions and

see how it will worked out under different circumstances. But as you said, Mark, that there is a in eight human boom and bus cycle built within us, and I don't think we'll ever ever solve that problem because there is no way to solve that problem unless humans can start working from perfect future information. Unless we do get crystal balls where we can tell the future. There's always gonna be as you said, there's always gonna be six cycles and fashions. There's gonna be cycles and building. Uh,

there's gonna be too much risk taking whatever. And I think and I fear most people nowadays have confused and conflated an elasticity or elasticity with something like too big to fail, which is, you know, sort of the quasi haphazard program that Ben Bernanke's fed tried to put together in the wake of the first financial crisis. That's not elasticity. That was something else. Entirely elasticity is that when we go into a bust cycle, that we don't end up

with a monetary shortage that then produces deflation. You can still have a bus cycle without the deflation that leads to the necessary um a creative destruction a Shompeter called it. We still want that to happen. We still want bad banks that have bad ideas to give out bad loans to bad people. We want them to go out of business.

But we don't want to have happened, and what does happen during these deflationary depressions is that when bad banks go out of business, it leads to good banks going out of business and good businesses going out of business at the same time. Because money becomes too dear, everybody holds onto money and there's not enough liquidity in the economy that bad banks and good banks alike end up going out of business, which harms the economy not just

in the short run but the long run. So the idea behind elasticity, the real idea behind elasticity not too big to fail, is that we sort the good from the bad. And the only way to do that is to make sure the good, good firms and good banks have enough money, have enough liquidity available that they can survive any bust cycle. That's what Walter Badgett was talking about in the nineteenth century from the Bank of England. You know, you lend freely at high rates on good collateral.

That was that was that was the central bank dictum of elasticity and currency. Now central banks nowadays don't do that because they can't They can't even define elasticity, or they can't even define liquidity, let alone create elasticity. But still that's the idea that I think that we need to be come to terms with is that elasticity doesn't mean too big to fail. It means limiting the downside to only those who made big mistakes. Where would you

put yourself? Um, from an economist viewpoint like on Austria an economist view and then maybe the opposite, being a Kinsian kind of view. Where do you? Where would you say? Are you somewhere in the middle? Are you would you consider yourself Austrian Kinsian? Or how how do you think about that? I've first of all, I'm not an economist. I'm just talking about your view. I'm talking about your

view that. Yeah, I'm not economist either, but I aligned with the Austrians, but I'm not ECONOMI No, that's I think being not being an economist is actually helpful because part of the problem is that you find yourself in a box. I've been accused of being a Kinsian, a Monitorist, and Austrian, a Marxist, pretty much anything around around the spectrum. I would I would like to think of myself as just a realist. UM. I started out with Austrian sympathies,

hard money, gold standard free market capital. Is it mean you just can't get over the history of what happens when you get into these deflationary depressions, which is the worst of the worst case. So for I, you know, I disagree with most of what Keene said about some of the implications and what what government should do in

the wake of deflationary crisis. But yet you can't argue with how Keens framed at least the deflationary disease you call what the worst evil there is because in a deflationary depression, the deflation, the consequences of that deflationary depression depression fall mostly on workers. So the poorest members of society are the ones who suffer in these worst cases. So we have a very vested interest as a society in the system to make sure that we don't have

deflationary depression. So if that makes me a monitorist, I don't care if that makes me, uh, certainly not an Austrian. But you know, sympathies for some of these other schools and doctrines. I think most of them have have at least some good ideas that you should listen to. But I really think part of the problem here is that everybody gets very rigidly doctrinaire and ideological and stops thinking about and thinking about things in terms of evidence and

actual history. Yeah. Just you had said that in you know, you do believe banks should be able to fail and wash out the bad ones and creative destruction. I agree with that. But then you talked about the in a in a deflationary event, that the good banks go out

of business with the bad banks. And we just recently saw this in the crypto markets right where well we saw in two thousand and eight obviously when with the investment banks, and recently in the crypto markets, and a lot of that is because the contagion that's taken so too much leverage built up in the system, the contagion because they're all um, you know, doing loans with each other, and so when one goes down, then they lose that those assets and dominoes the whole thing and so um.

In a it's the leverage that seems to be the problem. And so in a system where we didn't have all this in uh in monetary inflation, um, and we didn't have all this leverage that built up, and we had banks that were on full reserve for example, then those banks wouldn't go out of business, they wouldn't be subject to the mistakes at those and you would never have

economic growth because of the inelasticity of the money. Yeah, because they're That's the thing I think that's the other part of this that we're forgetting is that, you know, we live in a dynamic world where demand for money is not static. Demand for money changes, and I'm talking about legitimate demand, not just speculative demand. Legitimate demand rises and falls, and we're supposed to be able to to u to get a sense of that by the you know,

interest rates. For example, if there's a legitimate demand for money. I know, legitimate is a sort of a weasel work here, and it's doing a lot of work, but legitimate demand for money goes up. You know, do we really want the price of money to skyrocket because it's fixed. If there's legitimate demand for money for legitimately productive and sustainable purposes, why wouldn't we want the dynamic money supply on the supply side to be able to meet that demand for

money without causing frictions and harms and inefficiencies. So if you have a fixed money system where you don't dynamically meet demand. Two things happen. One thing is you'll get lack of economic growth, and the second thing is the commercial system will invent new ways of new forms of money to circumvent the hard money, uh, the hard money cap so to speak. Let's this happened throughout I mean the Euro dollar system itself was an answer to Triffin's paradox,

because Triffin's paradox wasn't really a paradox. It was simply the the international reserve system under Breton Woods was incapable of re of meeting rising global demand for money in a dynamic setting. So I don't you know, I don't agree that demand for money or the supply of money needs to be fixed in order to make sure that we don't ever have an asset bubble, because, like I said, I think business cycles happen anyway. They're gonna happen regardless

of whether or not there's fixed money or not. You saw that, I'll throughout the nineteenth century, on the best of the best, the classical gold standard, there were bubbles everywhere. It happens. It's it's it's a flaw and human nature not in the monitor. And I would agree with that they happen. And that's the problem that we see all throughout the world today. Um. For example, with a look at the rise of antidepressants US, especially in the United

States for example. Well like, uh, you need you know, without we we can't always just be happy humbers at the time, like we have to have pain in order to know joy for example, right, And how how do we know the happiest time of our life if we don't have sad times and things like that, and so

a lot of that. But but jumping back, stay staying on track here with the money supply, so um, like with bitcoin you've mentioned many times and I've seen your interviews with one of my good buddies, Robert Breedlove Um, and you mentioned, now bitcoin has some superior attributes transparency, lack of asymmetric things like that, but it's the inelasticity with that because of bitcoin of course has a fixed mon terary supply and over more than twenty one million,

then you think that leads us back into the Triffan's dilemma paradox kind of thing, um, and then back into some sort of a euro dollar or some sort of a new emergence of a credit based system. Yeah, I

think that's the primary drawback. You're right, because I think bitcoin is an elegant idea, an elegant step in the right direction, because one of the problems with the Euro dollar system is that it is a distributed ledger, virtual currency, digital currency technology, but it's maintained by just the banking system them and it's completely opaque. We don't really know what goes on inside of it, which has privileged the

banks even that much more. An Austrian concept called cantilling effects, which if you're able to create money more than if you're able to create money and nobody else's you get the benefits first, which of course then leads to over financialization, if not hyper financialization, which we saw in the pre crisis era. So Bitcoin, in a lot of ways was a step in the right direction, certainly in terms of transparency, but also in terms of just simplicity. Um, we don't

need an overly complicated monetary system. In fact, we don't want an over overly complicated monetary system because money is supposed to be a commercial tool. It's not wealth, it's not anything else. It's supposed to allow a modern capitalist, free market economy to do what it does best, and that's that's we focus on productive uses of our time. We're not hiring all sorts of accountants and lawyers and attorneys and banks to hedge our financial risk. We should

not think about money whatsoever. It's one of those things you should just be in the back of your mind and you never really have to deal much, you know,

I never have to think much about it. And that's one of the problems with the system that we have is we spend so much time talking about this stuff and worrying about this stuff and watching it go crazy, that we've kind of lost focus here on the real economy, which is what's supposed to so Bitcoin I think represented at least a couple of good steps in the right direction. I worried though, that it didn't take enough of them in the right direction, and it leaves us in the

same sort of inherent flaws that we had before. And again, the an elasticity problem is that yes, we're gonna have pain, we're gonna have business cycles. They're gonna be good times and bad times, but there really is no reason for the bad times to be so bad that it endangers the long run future, which is what we saw in the nineteen thirties or in three but we didn't see it in nineteen o seven because there was elasticity in

the banking system created by the banking system itself. So, yes, boom bus cycles will happen, but we don't need to have the worst of the worst case present to be presented with the worst of the worst case when we do get into the bud But if we hadn't, if we hadn't built the money supply up so big, Um, the boom wouldn't have gotten so big, wouldn't, And then it would have made the bus so fall so bad. So if I'm walking on a one foot wall and

I fall off, it's not that bad. If I'm walking on a hunter football and I fall off, it's really bad. And so if we look at if we look at it from that perspective. So for example, um, the problem that we're in today, right, So they the last couple of years, and to the point you're saying, I mean the creation of the money supply. This increased the money supply, the Fed Fed Treasury stimulus of the last two years.

I'm not going to dig into the intricacies of that, but we saw a rise in stock market at home, prices have doubled, etcetera, etcetera, and so the average person, um, if they don't participate in that, they get left behind. So I'm a contractor. You know, I work on homes, and let's say that. You know, I have all these jobs, and it's like, well, I need to take on these additional jobs. I need to hire more employees, I need to go finance more vehicles, I need to move into

a new office to keep up with that demand. Now I could choose not to and I could just store my money, to your point and not have to worry about it, which is, I agree, is the way it should be. But if I play that game, I'm just gonna put my money to banking and ignore it. I'm not going to scale my business to keep up with demand. Then I get left behind. So I'm forced to play

that game. But then all of a sudden, let's just suck the money out of the system, and then everything crashes, and now I'm stuck with all these trucks and these extra buildings because I had played in that game, and so um, if we didn't have this boom that I had to I was forced to play along with and keep up and then the inevitable bus that now crushes me. Um, it doesn't seem like the worst thing in the world. That we'd stop booms and bus but they wouldn't be

so massive, and I could just store my wealth. But under the terms that you've dictated. But isn't that what's happened is true. But that's not how it That's not what actually happened. What we actually happened was we had a legitimate economic growth before the pre crisis, before the crisis UH showed up. Yes, there were bubbles, there were imbalances in certainly US real estate, but you look around most of the rest of the world emerging markets, China,

for example, backwards communist subsistence agriculture. China turned into a global powerhouse, which we all benefited from. By the way, in some ways some people more than others. Obviously was at the expense of certain parts of the US. I grew up in the rust belt, so I knew exactly where all those jobs went. They certainly went to China. But by and large, the the growth cycle, certainly from the nineteen eighties forward, was a legitimate growth cycle, and

you can make it. I would make a strong case that that wouldn't have never that would never would have happened. In a restrained fixed money system, we never would have had that growth, and so it's difficult to prove the counter factual that, hey, um, maybe we shouldn't have had

that growth to begin with. I don't know. I think the world is a better place because of the globalization that certainly showed up from the nineteen fifties four as soon as the euro dollars started really producing, you know, these virtual dollars in in in excess. That's really I think there was a very real benefit to that, and had it not happened, the world would have looked very differently than it does today, or at least in two

thousand eight. And the problem was not that we printed money after the crisis, is that we didn't that we didn't fix the monetary issue in two thousand eight, we didn't create elasticity, and that has led to a permanent change, at least so far permanent change in economic growth. So that we are over the last fifteen years, we are seeing what the global economy would have looked like had it not had enough money, and it looks increasingly ugly

by the year. There's a reason why we were witnessing social, political, and economic upheaval all over the world. It's because of we're seeing what happens in in an economic system that is deprived of any monetary elastics. Well, I certainly agree with that. I think a lot of the upheavals that we're having around the world is also because of other bad policies such as restricting energy, whostend, restricting enough food. But those are different topics for it difer in time.

But sticking back on this topic of the inelasticity of the money supply, um, I would agree that. I would think that we both agree that we don't need money. Nobody wants money. What we want is the things that money buys us, which is back to the point, we made goods and services, right, That's what economy makes, goods and services. So I don't want the money. I want

the goods and services. Now I would ask people typically when they say, well, doesn't the money so I always need to increase or expand, I would say, um, wouldn't you rather? And to the point that you made, which I agree with Like a brain surgeon, the world, the world blew up into prosperity because of specialization right, and now I could be the best brain surgeon. I could focus on brain surgery, and I should just focus on

curing cancer or whatever that is, finding perpetual energy. Focus on that, and then my money should just go sit and it should just I shouldn't have to think about it to the point that you made I agree, And so then I would just ask the average person, wouldn't you or would you rather your money that you've saved today buy you more goods and services in the future or less? And I think everybody agrees they would want their money to buy them more goods and services, not less.

But through an inflationary system, the money continues to buy us less and less goods and services. And so if we look at what we really want is goods and services, the money is a proxy of that, so a minium exchange for that. So we have all the wealth of the world, all the goods and services of the world, divided by the money. And if we're trying to keep the money at one, then all the value goes to

the goods and service, so everything gets more expensive. But if we had a fixed money supply, then the value could accrue to the money and the goods and services would go down? Am I seeing that right? In theory theory? Yes, the problem is that leads to all these similar boom busts, but not if we not if we don't sure it looks good and in terms of prices, but what happens

when everybody's thrown out of work. That's really the issue here is that, Yeah, okay, so my money buys me more on the other side of a crisis, but I also don't have a job today, So that's not a really good trade off by any stretch of the imagination, particularly when those who are thrown out of the work are the most vulnerable in society. And you do that enough times and then you end up with what we're

seeing now, which is increasing discontent, extremism, and anarchy. Okay, And to your point, we don't we don't know, We don't have a we we don't have an A B test to really run, although we do have five thousand years of history without a Fiat money system, so we do kind of have that. And to your point, there are booms and bus because cycles change, creative destruction happens, but we don't have the massive amount of misallocation that we would have today. Um, but again we don't really

have that. I guess what I would say then, is, um, what problems would a bitcoin underwritten capital market need to solve in order to be viable in your mind? Well, first of all, it has to have a wide enough base, so it's wide enough it could be used in a wide, widespread Uh, it needs to be. That's really what a global reserve currency. And that's what we're talking about, right Mark. You look at it bitcoin not just for a niche use.

You want it to be a medium of exchange, not just a or value, but a medium, a useful medium of exchange that can be used in enough places that it becomes a useful medium of exchange. And so it's sort of like a self fulfilling prophecy there. That's what a global reserve currency actually means. It means it's available, freely usable, and widely used in all in as many places and as many circumstances as it can possibly do. And a fixed monetary system makes that incredibly difficult, especially

when it's not widely distributed. And let's face it, money, money is always going to pool, It's always gonna tend up, It's always gonna end up in fewer and fewer hands, because that's how free market capitalism works. Successful people are going to end up with more money in their hands. And what ends up happening in that situation is you need some form of financialization to get that money moving

back into the real economy. So you can't escape financialization unless you're willing to go back to a completely commodity physically owned system or the digital equivalent of that, which means you're actually reducing the potential of that economics system. So bitcoin, I think, has a couple of problems, including what happens when it's hoarded, as well as is there enough of it to be used any widely, widely used across enough places in the real economy. And of course

geography is another part of another. So a couple of things. So one to your point, sure, it has to be widely accepted, right, So money has to have a bunch of attributes, five of them that I really like the key on. But one of them of course is sailable, right, you know, recognizable people have to be able to day take it. And so to your point today, right, I mean it's it's very small, but we're a dozen years into it, So I believe money is like an evolution.

If we look through the history of money, it's evolutionary, it's emergent, right, So we use rocks and feathers and seashells and all these things, but one emerged as the best because I had the best money properties. Um, and so I think, you know, there's like a store, like a collectible. Oh this is kind of cool, like I'll hang onto this feather, this rock, and then eventually maybe

that collectible maybe evolves into a store of value. So we see the wealth holding fine art and cars and things like that, but those don't have money attributes, and so maybe a store value could then evolve to need him of exchange. And I'm happy to admit I don't think bitcoin is the best medium exchange today. It's certainly too volatible. Were paying your bills with on a monthly basis, and and it hasn't reached that wide scale adoption to your point. So I think there's an evolutionary path, but

it does have the attributes I think for it. The one thing I would just point out, and I'm sure you're probably aware, but uh, you know, one one of the many things with bitcoin is that it's the first uh, first asset, the first commodity that doesn't need debt to reach velocity. Right. So gold is very slow, right, it's not portable. I can't send it to England very or over over zoom to you right now. And so we had to add the debt on top of it in

order to get the velocity. But bitcoin has velocity with a bare instrument, which is which is pretty interesting. But anyway, so back to the question. So, I guess you answered my question so that what it would need to solve was it would need to be more widely accepted. I guess was the point more widely US and and usual meaning more people are able to use it? Right, it's it's friendly enough and easy enough. Yeah, not just the more people, people in all kinds all types of use cases,

got it? Yeah? Okay, good um. Now let's jump back to the final uh discussion here that you had set up earlier. It wasn't on my list of questions, but you talked about you know, maybe or I'm framing up as as this endgame. So you said the yield curves are predicting, predicting that you know, there's probably one more pivot in front of us. That's where they're really worried. Um, you had said that maybe there's a few rate hikes

before something breaks. Um. I don't know if you had said or maybe this is where I think, but probably before the end of this year, we'll probably see that before something breaks and then they reverse course. We don't know what that is. We can only speculate. What would you what do you think is the base case of the speculation? I know we're only talking in terms of probabilities here, Um, credit markets dry up or what do

you what do you see there? Yeah, there's a lot of potential potential sparks or potential shot that we could go through, and I think we already did when oil prices skyrocketed in early March. I think that was the trigger for what we're seeing in terms of a base case recession. So the first half of the year technical recession. As you said, Mark, that's that's that's completely a distraction. That's not really Markets are not worried about what's already happened.

They're worried about what's coming next. And what's coming next looks like, okay, we start with the recession, but there are also any number of problems from geopolitics to money itself. A big part of the monetary system is repo and collateralized transactions and derivative things like currency swaps, and believe it or not, there's just not enough good quality collateral to go around, and so we get into these situations where dealers in particularly become risk averse, certain junk quality

collateral becomes less negotiable. It acts every bit as if

monetary system was being tightened from the inside. And so I think one of the things that is forcing these curves to be and as inverted as they are, is cancerns about a collateral run as we saw in March of and again in two thousand seven and two thousand and eight, because we've been stuck in this collateral shortage situation for the last fifteen years and it has never really been handled, and it is lee it leaves the system and I mean the global financial system as well

as the economy, and it precarious situation when it becomes you know, when we get into these risk averse situations where collado becomes scarce. So I think collateral shortages, which are prominent in every marketplace that we see, especially something like treasury bills repot fails, and again the US dollar skyrocketing. Why is it going up Because there's problems in the in the collateral system. That's part of what's going on. And then, um, the other part of it is something

like geopolitics. What if the Russians do turn off gas to Europe? What is that gonna look like for the world. I mean, that's something that I if I was, you know, running a massive portfolio of hundreds and hundreds of billions, I would probably want to hedge against something like that happening. Or not just gas to Europe, how about food to the Middle East. I mean, so there's any number of real potential shocks that could make a already bad situation worse.

And I think that's really the issue here, is that we're heading into the second half of this year all sorts of potential concerns in front of us, and we're starting off the second half of the year on the wrong foot anyway. So, I mean, I can understand why curves are priced the way they are in ways that we haven't seen since two thousand eight, because the risks as well as the reality are that on appealing. And you you highlighted a number of those and we have

even more. There's all types of land mines out there that could that could blow up on us. So, UM, now, I guess the last question we'll just kind of end it with. And maybe it's not a big one, but if the FED has no control, uh, the euro dollar market is much bigger. Um. Let's say that we have this uh you know, they end they end up with

a few more hikes, they stop. We have any of these signal again events that could happen to the points you said with the food crisis the energy crisis, those are two big looming ones of another potential pandemic lockdown. That's it seems to be rearing its head again potentially. Um, then the FED would have to reverse its course and would try to do something, which to your point, maybe they can't. But if it was whatever seven billion in two thousand and eight, it was six seven trillion, and

I mean, is the next one ten twenty trillion? And will that have any effect? Can they even keep the bubble from d leveraging? I think the next one is I think that what the FED will look at is not so much size, sort of take a playbook. Because everybody follows the Bank of Japan anyway. I think what they do is to take a page out of the Bank of Japan's book where they say, okay, we've bought treasuries. If nbs in the past I didn't really have much

of an effect. Maybe this time we're going to actually buy corporate bonds. I know they pretended to into didn't actually buying many actually buy corporate bonds. They'll start buying et still, start buying different asset classes, because this is all about psychologist, is all about trying to shock the system in ways that the FED wants the system to

be shocked. So I think rather than rather than seeing an increase in size of quantitative easing, you'll see like Japan where they'll they'll add to the target of the list of targets for asset purchasing. Okay, all right, more strategic or just again just like vocal throwing something against the wall and hoping it works. Well, man, there's so much more we could go on with, but we've we've gone super long. I appreciate you taking the time and

to everyone listening. We had some some frustrations with my on my own the recordings. Appreciate your patience with that. Jeff UM, I know you do the euro Dollar University podcast which I listened to, and uh, I recommend everybody check that out. Will link to that below. Markets insider pro dot com and portfolio portfolio shield dot net I believe, or two other projects you're working on will link to those. Um,

anything else that you want to call out. I writed a different places to real clear markets epic time times, so you know you can find the research anywhere around the research writing commentary. You are all over the internet right now, and it's never been been more important to understand how that works. So anyway, Jeff, we'll go ahead and in it with that. Thanks so much for for coming on today. My pleasure, Mark, thanks for the invitation.

I really appreciate it. All Right, that's a wrap. Thanks for listening to this interview with Jeff Snyder. We've covered a lot of topics, a lot of topics that are maybe not so much conspiratorial or controversial, but definitely outside the mainstream view. The vulkar myth the FED has no control of course. Check him out Jeff Snyder at the euro Dollar University Podcast. We'll have all his links down below. And that's what I got for you today. All right to your success. I'm out.