Best of the Program | Guests: Michael Malice & Carol Roth | 4/8/22

41m
Pat Gray joins Glenn and Stu to discuss CNN+’s embarrassing launch and college students calling out CNN’s disinformation at a conference. Author Michael Malice joins Glenn to discuss the news of the day, including the misinformation being spread by our intelligence community and the mainstream media. Recovering investment banker Carol Roth joins to discuss her article “Creative ways to combat inflation.”
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Transcript

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Today's podcast, great one.

Michael Malas is on.

We talk to a couple of people that really know what's going on in Washington.

One is a Republican that's going to probably be the head of the

finance committee in Washington that looks over the financial sector.

He's talking to us about what's really going on and the dangers of a central bank cryptocurrency from the Fed.

Also, we talk about the dangerous pattern that we now have in our intelligence community using unverified sources and facts as propaganda in the war in Ukraine.

Carol Roth also joins us about the economy and what's ahead there.

By the way, if you want to save a little bit of money, you have an opportunity.

I think it's open till Sunday.

You said at one point it's Friday,

maybe it is.

I think it might be this weekend again.

If you try it, if you listen to the podcast on Saturday and give it a shot, feel free.

But it's the code thealamo when you sign up for Blaze TV at blazetv.com/slash Glenn.

If you do it there, use the code thealamo, you'll save 20 bucks off your subscription going forward.

And one of the things you get, you get access to the weekly Wednesday night television show, which next week is

a dangerous show, but a very serious show.

It's on the president's cognitive collapse.

Also,

you get things like our podcasts.

You get the one-on-one interviews.

You don't want to miss this interview this week on the podcast.

It comes out Saturday.

It's been out for two days if you're a Blaze subscriber.

But it is, it's all about Hunter Biden's laptop

and the Biden family.

Don't miss it.

That's tomorrow's podcast.

Here's today's.

You're listening to the best of the Glenbeck program.

This is the Glenbeck program.

This is the last day for the promo code The Alamo.

We are.

Oh, I know why.

You're going out of business.

The whole company's going out of business, isn't it?

So, this is the last day you can save because tomorrow

it's all gone.

Is that what it is?

Yeah, I think so.

I think you're talking about CNN Plus.

Oh, that's right.

CNN Plus.

Plus.

I think that's what you're right.

Anyway, we really need your support.

Social media has just,

they have us by the throat.

And we built this to be able to be, to withstand several attacks on us, but

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Save $20

right now.

And today is the last day you can do that.

So, speaking of CNN Plus, which

on day two,

they

gave a 50%

cut on the rate.

That means day one went so well that they didn't have to charge as much anymore.

Is that what it is?

I have been speculating in my own head how few people actually subscribed.

And I'll bet you it was under 30,000.

Yeah.

Oh, I bet it was way under 30.

Do you?

I think so.

Think of the global reach.

I'll bet it was between one and five

thousand or one and five thousand

five people now.

Yeah, because I think you're right.

This is the type of organization they put a fortune

into this.

I mean, they have so many employees.

They're already talking about laying off employees.

I'd love to do an interview on that with Brian Stelter.

Why?

Why particularly Brian?

Because I do remember you've been interviewed by Brian Stelter before.

Well, what I'd like to do is invite him on to talk about something very important

that I know he's really interested in.

Sure.

And then

right at the point where you're making the point, I would say,

Brian, isn't your company collapsing?

Aren't you about to go out of business?

It's weird.

Why would you say that?

I don't know.

How do you think he'd react to something like that?

Do you think he might just stand up and turn around and walk out of too much of a fat lump to do that?

Standing is hard.

So

yesterday, they had this

big,

I don't even know, conference where they brought in all of the liars and they set them on a stage and they said, We've got to talk about misinformation and disinformation and malinformation and how it's destroying our democracy.

So, the guy I pick right away is the fat lump from CNN.

And

he was asked a question about Disney.

And he said, you know, the theme, the talking point of the right about protecting kids from the dangers of the Walt Disney company, it's really, Disney is just a stand-in.

It's a symbol for something bigger, a conservative backlash to growing acceptance of gay and transgender people.

Oh, my gosh.

You couldn't be more wrong if you try.

And I think he tries to be wrong.

Again, the bill they're talking about would also prohibit you talking about straight sexual encounters.

It's not how it could possibly be about being gay when it also would prohibit straight conversations makes no sense.

It is truly about, because I looked up the definition today from the Justice Department and the

American Bar Association.

It is grooming.

It is technically grooming.

Yeah,

this is that big debate right now of whether whether you use that term.

I think, you know, I look it up.

I thought who really made a good explanation of this was James Lindsay the other day.

And one of the things he mentioned was people keep saying grooming, like, look, I think Chris Hayes is wrong on basically every issue on MSNBC.

I'm sure we would agree on nothing.

Do I think he's trying to molest children?

No, I don't.

But that's not the definition of grooming.

Right.

That is one definition.

Like, Jeffrey Epstein, yes, he would be called a groomer.

Now, again, wasn't gay.

Had nothing to do with being gay.

No, he was not the groomer.

Yeah, the

Gladwell, whatever her name was.

Jelaine Maxwell.

Yeah, Maxwell.

Well, again, they work together on that.

No, I know that, but she was doing the grooming.

He was doing the molesting.

Yes, I think

some of the stories, like, you know, they both imported a young teenage painter to their house and kept the...

There are cases where Epstein, I would definitely put him in this category as well.

But again, like you jump to that what what what uh james lindsey said on the show is that like think of grooming as for a cult for example yeah you're trying to to

look at the craziness we're talking about uh men are women and women are men right like these basic facts that everyone understands you're trying to convince people to question a foundational truth that they all know that is the type of activity cults do all the time right but here and here's the other part that cults do they also separate you you mainly from your family.

They start separating you and making sure that they are between you and mom and dad or you and the family.

And anyone who comes up against it, they are discredited and they're an enemy of the cult.

Yeah.

That's what this is.

Yeah.

I mean, listen to some of the people who have left, you know, Scientology who believe they've been groomed into that lifestyle.

You know, I can't think of her name, the lady that was on King of Queens.

I mean, listen to her talk about it.

This is exactly the stuff she's talking about.

She's not talking about the grooming stuff like Jeffrey Epstein.

It's a totally different thing.

Pat Gray joins us from Pat Gray Unleashed, the podcast you can get anywhere.

At the Disinformation and the Erosion of Democracy Conference, a University of Chicago freshman stood up and said, I've got a question for Brian Stelter.

My name is Christopher Phillips.

I'm a first year at the college.

My question is for Mr.

Stelter.

You've all spoken extensively about Fox News being a purveyor of disinformation, but CNN is right up there with them.

They pushed the Russian collusion hoax, they pushed the Justice Mollet hoax, they smeared Justice Kavanaugh as a rapist, and they also smeared Nick Salmon as a white supremacist.

And yes, they dismissed the Hunter Biden laptop affair as pure Russian disinformation.

All true.

With mainstream corporate journalists becoming little more than apologists and cheerleaders for the regime, is it time to finally declare that

the canon of journalistic ethics is dead or no longer operative?

All the mistakes of the mainstream media and CNN in particular seem to magically all go in one direction.

Are we expected to believe that this is all just some sort of random coincidence or is there something else going on?

Listen to this answer.

Too bad it's time for lunch.

30 seconds.

There's a clock that says 30 seconds.

But I think my honest answer to you, and I'll come over and talk in more detail after this.

No, please, no thanks.

Is that I think you're describing a different channel than the one that I watch.

But I understand that that is a popular right-wing narrative about CNN.

I think it's important when we talk about shared reality and democracy.

All these networks, all these news outlets have to defend democracy.

And when they screw up, admit it.

But when Benjamin Hall, the Fox correspondent, was wounded in Ukraine.

Stop, stop.

But he refused to admit it.

He said, basically, those things didn't happen.

That's just a narrative.

All of those things are easily verifiable.

You know, you just have to admit it, but he's part of the disinformation, and yet he's the expert trying to point to the disinformation.

We're in an upside-down world.

Let me give you one more college student that went after Ann Applebaum.

Listen to this.

So in 2020, you wrote, those who live outside the Fox News bubble do not, of course, need to learn any of the stuff about Hunter Biden, referring to his laptop, of course.

A poll later after that found that if voters knew about the content of the laptop, 16% of Joe Biden voters would have acted differently.

Now, of course, we know a few weeks ago the New York Times confirmed that the content is real.

Do you think the media acted inappropriately when they instantly dismissed Hunter Biden's laptop as Russian disinformation?

What can we learn from that in ensuring that what we label as disinformation is truly disinformation and not reality?

My problem with Hunter Biden's laptop is, I think, totally irrelevant.

I mean, it's not whether it's disinformation or, I mean, I don't think the Hunter Biden's business relationships have anything to do with who should be president of the United States.

Oh, my gosh.

I didn't find it to be interesting.

You didn't find it to be interesting.

That would be my problem with that as a major nation.

Okay, stop.

This is,

too, is incredible.

She's from the Atlantic, and so that's why she talks like this.

But she finds it not interesting.

Here are the headlines that she has written lately.

Tucker Carlson is stirring up hatred of America.

The My Pillow Guy could really destroy democracy.

Laura Ingram's descent into despair.

That she finds interesting.

But the relationships that are providing money to the current president.

Not interesting.

Not interesting.

You know, if it was Donald Jr.

Oh, she'd find it very interesting.

What's she the fuck?

I don't know.

Really?

Yeah.

If he's making millions from a foreign country

and has written emails that like a 10th or 50% of it goes to the big guy, his dad,

I don't think so.

I will tell you

I can, I know, I would lay,

I bet my house and everything I have on the two of you, but I don't know if I can say that about most of the media on the right or the left, that if this were reversed, we'd cover it.

We would cover it.

No cover.

And I'd call for the impeachment of the president.

I think we've proven that.

I think we have to.

I think we have to.

It's very interesting.

And it's fascinating to me that they are continuing the lie.

It shows they haven't learned anything.

They're not interested in learning anything.

They have decided what the role of the media is.

And the role of the media is to protect the Democratic Party.

That's it.

And now they are taking the step further and they are openly saying

anything that disagrees with us up on this stage is disinformation and a threat to democracy.

That should scare the hell out of people.

Now, what's really good,

the college students that were there.

Yeah.

And the fact that we're not a democracy.

That's also really good.

Yeah, really good.

So we don't have to worry about democracy.

We're not going to be warning against it so often.

All right.

Thank you, Pat.

Pat Gray from Pat Gray Unleashed.

You're listening to the best of the Glen Beck Program.

This is the Glenbeck Program.

Welcome to Michael Malice, the author of the anarchist handbook, Dear Reader, the Unauthorized Autobiography of Kim Jong2

and The New Right, A Journey to the Fringe of American Politics.

Co-author, strangely, of two New York Times bestsellers.

Who knew?

He could get on the New York Times.

I can't get on the New York Times.

I mean, not on the top 10.

Yeah, you're

number one in sales, but number 15 on the New York Times list.

It's amazing how that works.

Welcome to Mr.

Michael Malice.

Hi, Michael.

How are you?

Good morning.

Sunday morning.

Yeah, yeah.

I've got several things to talk about.

First of all, I'd love to hear your opinion on the AP reporter that absolutely knew the Pentagon was lying when they were like, yeah, and Russia might be using chemical weapons.

And now we find out that our National Security Council and our intelligence are spreading misinformation.

They're using it, and they think it's a noble lie.

You know, we're just trying to stop Russia, trying to beat them to the punch.

So they are using disinformation on the American people and on the rest of the world.

That doesn't sound like a good idea.

It may have been a good idea maybe 20 years ago when you wouldn't have social media and other such mechanisms that can demonstrate things that aren't true and have them spread, you know, quite literally at the speed of light.

I think this is just piss-poor strategy.

I think if you want to whip people into a frenzy against Russia and talk about the things the Russians are doing, anytime you add lies on top of that pile, it's just going to alienate people.

And there is a huge percentage of population, both from Democrats and from Republicans, that whoever the sitting president is, they're just going to immediately disbelieve anything they say on its face.

So to have like actual receipts that they're being deceptive is really crazy.

And also it just speaks to why I'm hopeful about the future.

You know, the enemy class, which includes corporate journalists, these are not clever, sophisticated people.

They're not good at being manipulative.

They've just been at it for 100 years and they're not in a position to change their strategy.

And that bodes well for all of us.

Yeah.

And I, you know, I was thinking, I was thought about you this morning when I was reading this article because I thought this is what the founders wanted us to to feel like, not about journalists.

They were counting on journalists holding the line, but they wanted us.

I mean, George Washington talked about it.

Thomas Jefferson talked about it all the time.

The government should never be feared by the people.

The government should fear

the people rising up and the peoples holding them accountable and never trust the government.

And

we've trusted it for so long.

And I think this is actually a good thing that we don't really trust them anymore.

Well, I don't know who he is here, sir, but you're speaking to an anarchist.

So we have never trusted the government.

I will also point out that Jeffrey, I'm a big Alexander Hamilton fan, but Jefferson was a good example of this because, Glenn, as you know, and I know, which people find interesting, when Jefferson was in the cabinet, Washington's cabinet, he's leaking left and right to the press to make Washington look bad.

So he, in this case, put his money where his mouth is, and he used the press as as a mechanism to keep the government in check.

So this has been going on, this kind of backdoor collusion between the media and the federal government since, again, the Washington administration.

Always.

It always.

But, you know, the one thing we did have is we had a media that, I mean, when I was watching that video, it was about two months ago with the AP reporter.

sitting there and just not giving the Pentagon any room to breathe.

He's like, look,

so where's the evidence?

Because I know how this works.

You say something like that and you usually come out here and you'll show us declassify, but you're not doing that.

So you don't have any evidence.

No, of course we have evidence.

We're just not going to share with you.

Now we find out that they don't.

But there was only one guy in the press that did that.

I'll defend them, broadly speaking, in one sense.

I don't think any of us are privy to what kind of pressure the Pentagon and the state is capable of exerting on media outlets, what kind of phone calls they can make behind closed doors to make sure their story gets out.

I think they have a lot more leverage than any of us realize.

And that could have been there.

Well, not you, of course, but that can manifest in things like reporters being told, okay, we're not talking about this issue.

And what is that individual reporter working for a media conglomerate supposed to do?

No,

that media reporter

has what's called the internet and should go out and expose it.

That's what they should do.

Anybody at this point that looks at their job and says, I'm going to be quiet when I have information that is really critical to the survival of our country and our republic,

I don't,

I hold you responsible.

You should have said something.

It drives me nuts when these people leave, you know, years of service at the Pentagon or whatever, and then they come out a year later with a tell-all book.

Why didn't you say something when you were there?

Yeah, I mean, you're not going to have me defend them in the sense of saying that they're courageous people.

I'm just saying that it makes sense in many cases why they would make those decisions that they did.

So the New York Times or the Washington Post came out this week and said, Elon Musk

investing in Twitter, bad news for free speech.

I mean,

that is the upside-down world.

I was ecstatic because I think what is Elon Musk, I had this tweet that Elon Musk has done a better job of going on offense than practically the entire conservative movement.

What's wonderful about this, and I don't think Elon particularly cares about free speech so much as being a counterpuncher like President Trump was in certain contexts.

For them, Twitter was their sacred space.

This was their temple.

This was their place to manage the conversation, to discuss the political issues.

And now you have this heretic, you know,

crossing the Rubicon saying, this is my house now.

And this is causing them before he's done one single single thing.

The only thing he's teased is, do you guys want an edit button?

So the fact that he's in their house is causing them so much existential distress.

It's absolutely hilarious because the key is you have to go where the enemy class is and make them feel unsafe, make them feel that their forts are breached, because then they don't have that error of smugness and they're going to have that shrieking of fear correctly because they're not in charge anymore.

What is different about elon musk than others i mean he is he has

is it his his

uh kind of i hate to say this because i hate thomas edison but is it is thomas edison kind of i'm just gonna go out and do it uh that kind of that kind of american spirit that gives him a little protection from people talking about elon musk you're using edison should you use tesla yeah or tesla yeah yeah i guess well tesla tesla kind of died broke.

But, you know, Tesla's another better example because Elon Musk is an immigrant.

Listen, I'm an immigrant as well.

And when you're born in another country, a lot of the things that Americans kind of take for granted and you absorb through osmosis, you're not going to kind of be raised in that context.

And I think Elon, and I'm being quite serious here, Elon's on the spectrum.

He's got Asperger's by his own admission.

When you have that kind of hyperlogical mindset, a lot of things that other people might kind of fall prey to,

you're going to have more strength to stand up.

So when he sees who is up against him and the smears and the lies, he's in a much better position, especially given his wealth and it's also his idiosyncratic personality to fight back and realize: okay, these are not people making mistakes.

These are people who, if they had their drothers, loved me yesterday and now want to put me out of business today.

You know, I will tell you that

everybody looks at Asperger's as

something horrible your kids would have.

However, it's actually

turning out, you know, if you can control it, it's like ADD.

If you can control it, it actually works out to be something

really good for the culture that we're in right now.

Yeah, there's certain great advantages people on the spectrum have that others don't.

So I think there's a big movement among people with autism to kind of humanize and be like, hey, we're not disabled.

We just think differently.

And I think there's a lot to that.

So

the Twitter thing with Elon Musk came out, what, April 5th is when they were first reporting on it.

That's when the Washington Post said it was a danger.

The 7th,

we get a story about the New York Times coming out and saying, you know,

you reporters here at the New York Times, you don't have to use Twitter

because we run the danger of, you know, an echo chamber if we're spending too much time.

too much time they just thought of this too much time on twitter uh and there's a lot of really dangerous people on Twitter.

So you don't have to use it.

Are those disconnected?

Well, I don't think they're connected per se.

I think it speaks to when Taylor Lorenz, who's one of the most malevolent New York Times reporters, she was

MSNBC, you know, crying about how mean people are to her on Twitter.

Notice the two contradictory statements, Glenn.

If it's an echo chamber, there's no nasty people.

If you're just talking to each other,

how are you getting all this hate?

So it's clearly it's not an echo chamber.

Then Twitter has demonstrated to corporate journalists how much hatred and contempt the average person correctly has for them.

I think what happened is, I'm sure, after that crying fit, there were phone calls behind the scenes to Twitter asking to crack down and make people treat journalists nicer.

They drew the line.

And as a result, the New York Times is somewhat retreating.

I'll take this with a grain of salt.

I think we all remember in 2016, after President Trump won, Dean Banquet, who's head of the New York Times, said, oh, we're going to do a better job of trying to accommodate more Americans.

Our reporting was way off.

And instead, they doubled, tripled, quadrupled down.

But I think this is a big retreat.

This is them.

We had four years of social media misinformation.

Journalists are being treated poorly when they're the heroes of our society.

And the more they're crapped on, instead of doubling down, now they're having to retreat.

So this is a victory that people should be very grateful for, even though it's a very small victory.

One last thing.

We've got about 90 seconds for this.

ESI Energy on Tuesday pleaded guilty to three counts of violations

in their wind farms.

They are a big wind power developer.

And apparently, they pled guilty to the murder of golden eagles.

Apparently, the birds were killed by blunt force trauma after being, quote, struck by the wind turbine blades at its facilities in Wyoming or New Mexico.

And

they're paying $6.2 million in restitution, I guess, to the Eagles' families.

But this is just, to me, this is just another thing that shows environmentalists are never going to be happy with anything.

Anything.

Well, I'm a big endangered species person.

I've got 200 species of succulents in my house, and I just looked it up while we're talking.

The Golden Eagle is the most widely distributed species of eagle.

It's not endangered.

It's not even vulnerable near a threat and it's least concerned.

So, this seems to me to be completely nuts.

If this was some kind of bird where there's like 50 of them left, then I could understand the idea of, all right, we have to have draconian measures to kind of protect them.

But that is not the case with this species at all.

So, this is just, you know, very bizarre, but this isn't unusual.

Wind farms are known for just decimating bird populations.

And by the way, those of you who have cats that live outside, your cat's entire life is dedicated to killing those birds.

That's a thing.

They like murder birds all day.

It's their

favorite thing.

I had a

hawk, I think, land in my backyard the other day.

And we were all watching.

We were having dinner.

And then we realized the reason why it landed is it was having dinner as well.

Yeah.

Yeah.

I mean,

it's a vicious way to die by Talon, but I don't have to worry about it.

Neither do you.

So let's move on with our lives.

Michael, thank you so much.

Always a pleasure.

You bet.

Michael Malice, you can follow him on Twitter.

But remember, it's just an echo chamber.

MichaelMalice.com is his website.

Back in just a minute.

The best of the Glenbeck program.

Carol Roth, a recovering investment baker and the author of The War on Small Business.

She has just released a new article.

You'll find it at theblaze.com, Creative Ways

to Combat Inflation.

Carol, I went over that with the audience yesterday.

Really, really good and so much better than

take the bus and what do they say?

Eat

lentils.

Lentils.

Eat some lentils.

Yeah.

Thank you, Bloomberg, for that.

Go big on lentils so grab that article now at theblaze.com creative ways to help combat inflation she has some really good advice on what people should be doing right now to save um let me ask you about the uh mortgage situation i'm getting a ton of calls and emails from people that say

should i buy so should i buy a home or not buy a home What do you have any advice on that or any insight?

All right, so I'll give insight because we're not allowed to give financial advice.

This is a disclaimer.

This is not financial advice.

This is just information for you to research and to consider.

So there are a couple of things to think about.

This is, again, a rule of thumb.

For every 1%

that a mortgage rate goes up, you are going to add about 10% to the cost of your home over the time that you buy the home.

So, you know,

as you see it kind of tick up and tick up, you know, if you wait and you have to get a higher and higher mortgage rate, just keep in mind that, you know, that's going to add 10% on the back end, which you're not seeing up front when you pay it.

I also heard I was with Neil Cavuto earlier this week, and he gave me a statistic that apparently the breaking point where it becomes unaffordable for people to buy homes,

and we haven't seen this in a while, so I just don't know how accurate it is today, is 5.75%.

So apparently, that's kind of what the industry thinks is the magic number.

There are a couple of competing things that we have going on right now.

We obviously have home prices that have been severely inflated because of the Federal Reserve's intervention in the market.

But we also have now a situation where our dollars are going to be worth less, so we need to have hard assets.

We also have a severe undersupply of homes in the market.

After the Great Recession financial crisis, that next decade, we were underbuilt by, you know, kind of four to five million homes.

So depending on who you ask, four to five plus million homes that we need in terms of the housing for individuals.

And we've obviously had a slowdown on immigration.

So we know the Biden administration is going to ramp that up again.

There's going to be more demand for housing.

So I would imagine that even if there is some pullback, you know, for some point in time, the fact that we have such undersupply and it's going to take so long to fill that in is going to at some point provide a level of support.

Not to mention, as we've talked about, Glenn, and we've written some articles at the Blaze about,

you've got these corporations who are flush with cash who are coming in and being buyers.

So you've got more buyers than just homeowners in the market.

That also provides some support for pricing at some point.

I really hate the expression.

Yeah, but this time it's different because it usually never is.

But this time,

there is one additional element, and that is we don't have a glut of housing.

We actually have the opposite problem.

Now, let me ask you this, because the interest rates at the banks are already going up for your loans.

And

it's already up in the fours, in some places, close to five.

Over five, yeah.

And

yet the banks are only paying 0.5%

interest for the loans, correct?

I don't know the exact amount that's sort of the national average now, but in terms of the spreads, obviously a rising interest rate environment is more favorable to banks.

And we have a situation where banks are flush with cash from what's been going on over the last couple of years.

So even if you have savings in your bank, they're not going to be paying you very much on that because they don't need to incentivize people to give them more money.

Right.

No, I'm asking about the way you curb inflation is the Fed charges the banks more money,

more interest for them to borrow money from the Fed to be able to lend it out.

So they're paying maybe 2%, you're paying 5%,

and they get to keep the 3%.

That 2% goes back to be burned.

Right?

Yeah,

so

I don't have the specific kind of number on average of where banks are in terms of their capital to give you a really specific answer.

I can answer that next time.

But yes, that is sort of the spread.

That's how banks make money, right?

They take money at a lower rate.

They put it out at a higher rate.

But you have to remember, too, they're also projecting into the future because they're locking in, in some cases, that rate for you for up to 30 years.

So they're kind of projecting it over time.

So

I'm not bashing the banks for making profit.

Okay, that's fine.

What I'm questioning is, how does the Fed suck that money back in from banks that are flush with cash?

Okay, so basically what they have done,

well, really over the last 10 to 12 years, but then they accelerated over the last couple of years, is they have bought assets in the market.

So they went in, they bought two different asset classes.

They bought treasury securities and they bought mortgage-backed securities.

And they're sitting with $9 trillion of those.

The Fed, $9 trillion worth of those on their balance sheet, which by the way, As we've talked about before, they bought that with money they created out of nowhere.

When we do that, we create money out of nowhere and go buy things.

It's fraud.

When the Fed does it, it's monetary policy.

So they created money, which is what is driving up the price of everything, because it's not productive assets.

They just added more to the money supply and they went out into the market and they bought all of these assets.

Now, in addition to raising the interest rate, the other thing that you've heard out of the Fed from their minutes this week is quantitative tightening.

They're going to let that balance sheet run off either with direct sales or just by letting those assets mature and not reinvesting the money.

And that's what changes the dynamic of getting the money out of the market.

Okay, but you can't just, if you bought Treasury bills, you can let it expire, but that means the government has to sell that someplace.

And right now, the treasury is not having to really pay interest to the Federal Reserve because it's illegal.

So those are almost interest-free loans for our debt.

But the rub is

when they take back in any profit off their securities, they actually have to give it by law back to the Treasury.

Right.

So we're getting, we are actually getting free loans, but that ride is going to come to an end.

And in flow, in high inflation, I mean, you're looking at

if, I mean, if they can't sell those treasuries and you can't pay the interest rate, then you are technically in default.

Yeah, as I said, there's sort of two different strategies they have.

They either let them mature and then they just run off the balance sheet, you know, because they have them at different maturities.

So they don't actually sell them into the market.

And then the secondary strategy is actually selling them back into the market.

But going back to bonds, which is super complicated, it goes back to the differential between yields and the bond prices.

So when you, you know, they trade on an inverse basis, and that's why you're seeing the yields increase.

Okay, so let's get out of the yield talk.

Let me, let me just, let me, let me just ask one more question on this.

How possible do you think it is

that,

I mean, government pensions already have to buy railroad, U.S.

Postal Service, U.S.

military, et cetera, et cetera.

They have a requirement that those pensions hold 20%

in treasuries.

It's a great way to force people to buy your treasuries.

Now, that's government workers, so whatever.

How likely is it that when we run out of people who want to buy our bonds and our debt, that they just go to a couple of things?

They go and say, you're not going to get the federal insurance on this unless you buy and balance U.S.

treasuries with it.

You buy some of the debt.

And also the same kind of thing is with Uncle Sam and ESG.

You won't be able to get insurance unless you buy these certain things.

It's a possibility, but look at what they just did during COVID.

There were no international buyers.

There were no domestic buyers to stand by and buy trillions of dollars worth of bonds to cover the spending that we did for quote unquote COVID relief.

And that's why the Fed bought it.

I mean, it was basically the monetization of the debt.

And obviously, that's part of what caused inflation.

The thought process is that as they raise interest rates, start to just decrease the balance sheet, they hit a wall, they can't do it anymore, and they reverse course.

And we've seen this happen over and over again over the last 12 years: where, oh, we're going to shrink the balance sheet.

The market kind of freaks out.

The Congress has their spending plans and they change course.

So, the reality is, in terms of the cycle, that there's some point in which they probably end up changing and going back and buying more assets again.

Let me, let me, let me,

one more question on interest rates.

The St.

Louis Federal Reserve leader has come out and said we need to raise interest rates immediately by three points.

That would bring us to 3.5 at the bank level.

How does the Fed work ⁇ does the St.

Louis Fed guy have much say?

What does that mean?

Well, we've been hearing from a number of people at the Fed, including who's considered to be the most dovish or the one who's in most favor of a lot of support and stimulus, Lyle Brainerd, who's up for vice chair of the Fed.

And we've been hearing pretty much sheer panic out of them, which is not really comforting for the market.

And it is so frustrating.

You should be so angry about this because they had so many opportunities where they could start to raise interest rates or they could have pulled back the buying program.

which as we talked about has the same impact in terms of rates.

They were buying securities up until last month.

So they could have stopped this a long time ago.

They could have had a nice slow trajectory, you know, 25 basis points here, 25 basis points there.

They could have put us on a normalization path.

Back in June of 2020, the market reached all-time highs.

So this was not something, in my opinion, that was necessary.

And they just sort of didn't let a crisis go to waste.

And now the same people who created this situation, who didn't know there was going to be inflation, who didn't realize all these things are going to happen, are now promising they know exactly what to do to save us from this economic catastrophe or recession or whatever it is.

And the idea that you can just all of a sudden start to run off the securities in a major fashion or to jolt rates and that's not going to have major

repercussions across the economy is absolutely insane.

Okay.

So I have a piece of good news that I want to run by you because I've seen this more than once and

I would love to get your opinion on this.

We'll return in 60 seconds with Carol Roth.