Best of the Program | Guests: David Buckner & Carol Roth | 3/17/22

Charlie Sheen is an icon of decadence.

I lit the fuse and my life turns into everything it wasn't supposed to be.

He's going the distance.

He was the highest paid TV star of all time.

When it started to change, it was quick.

He kept saying, No, no, no, I'm in the hospital now, but next week I'll be ready for the show.

Now, Charlie's sober.

He's gonna tell you the truth.

How do I present this with a class?

I think we're past that, Charlie.

We're past that, yeah.

Somebody call action.

Yeah, aka Charlie Sheen, only on Netflix, September 10th.

Hey, today, you really missed a great show.

If you didn't hit it, you're grabbing the podcast now.

Listen to the whole thing.

It's fascinating.

Things you will not hear anywhere else.

First, we have Ramaswamy on

with ESG.

He'll give you a very clear, and you know, he's only a guy who started a billion-dollar company.

What does he know, right?

He'll give you very clear what is happening on that.

Then we talked to David Buckner.

He'll tell you what debt means.

And then Carol Roth, we spent an hour with her on

how is this war going to affect your dollar?

And what does that mean?

It's a high learning curve today.

And back to the number one book in America.

The Great Reset by Glenn Beck.

It's available now.

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Right.

It's incredible.

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we did something wrong.

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You're listening to to the best of the blend back program.

There is a massive lie

that

you are being told, and that is that ESG and the great reset is not what you think it is.

It's not what these crazy people say it is.

Well, those crazy people that say what it really is

are the people that are at the top of the food chain, the elites that have put it together and put it into action.

And, you know, when we were working on this ESG legislation

up in Idaho, we're working with 20 different states, Idaho folded like a cheap suit.

And it's because

the lobbyists are coming out and they are spending a fortune to lobby against anyone.

who is trying to pass any kind of legislation against ESG.

It is

a lie when they say, oh, no, this is just the free market.

No, it's not.

No, it's not.

It's the opposite of the free market.

It is 21st century fascism.

Vivek Ramaswamy is with us.

He's the author of Woke Inc.

And Vivek, I wanted to get you on because you've had a couple of really great articles and tweets lately.

And I just wanted to

kind of mine this and have you explain what you mean by this.

I wish CEOs would say in public what they say in in private about their views on esg and dei it would go a long way towards restoring our trust in leaders esg represents the greatest social credit scoring system in human history

wow

welcome to the program you want to go into that

Yeah, absolutely, Glenn.

Thanks for having me.

And I'm really glad that a voice like yours is on top of what I think is the defining issue of our time,

which is the use of the private sector to do through the back door what governments cannot do through the front door.

That is what the three letter, I call this the three-letter acronymized version of capitalism.

Some call it ESG, some will say DEI, some will say CCR.

Behind it all is the CCP.

But whichever three-letter acronym you prefer, it is actually the definition of modern crony capitalism, which works in reverse.

It's not just companies bribing the government to do their work.

It is also the government bribing companies in return to do their work back for them.

And so, you know, look, I mean, I'm an author.

I've written these books, but I've also been a CEO, right?

I'm a founder and CEO, fortunately, of a multi-billion dollar company.

I was a hedge fund partner for years before that.

I wasn't born into Elite America, but I've lived it for the last 15 years.

I know how the game is played.

And I will tell you, I had lunch with the CEO of one of the largest companies in his industry.

publicly traded company and it was actually the day that I put out that first tweet.

It was just, I was so frustrated coming out of it because I felt like his therapist the whole time, where he had read my book and wanted to complain to me about all the things that he had to go through.

He's the CEO of the company, mind you.

And yet, at the end of the day, actually, I look back at some of the statements he's been making.

It's a carbon copy footprint of diversity and equity inclusion must be part of our agenda.

ESG is the way of the future.

But it's clear to me, he doesn't mean the things he's saying.

But the actual loss of public trust in many ways comes from the fact that even when the words are coming out of the CEO's mouth, whether you're on the right or the left, you know that you can't believe them.

And so that's a big part of what I meant by that particular remark I made.

So

it is truly terrifying.

When I was working against these lobbyists, small banks, local banks, were coming to the representatives in the state and saying, please, I cannot say this out loud, but please pass anti-ESG legislation or we're all toast.

Please pass this.

People are not willing to say it out loud, and that's killing us.

It's killing us.

That is the culture of fear.

And look, to me, the best health of the measure of any democracy, especially American democracy, is the percentage of people who are willing to say what they actually think in public.

Correct.

And Glenn, there is no doubt that we are doing worse than any time I can remember in my lifetime on that metric because we have combined the use of economic force with the normative questions that we settle through a democracy.

And so, you know, look, a democracy you're supposed to settle questions through persuasion, through free speech, in open debate in the public square.

Maybe you and I would have one view on climate change and appropriate policy towards it, and maybe somebody else would have a different view.

Or how do we correct for racial injustice?

Somebody else has a different view.

Great.

In a democracy, we talk in the open, in the civic sphere, and persuade each other.

What the ESG and related stakeholder capitalist movement do is they substitute economic force, firing you, excluding you from the economy, et cetera.

They use that force as a substitute for free speech and open debate.

And the ESG movement, in particular, uses the force of capital ownership in companies to do it, where you have an ideological cartel of $20 trillion in the hands of the top three asset managers in this country, BlackRock, State Street, and Vanguard, that go to the top companies in this country, show up as the shareholder, and say that we are the shareholders.

We want you to implement diversity, equity, inclusion, cut your carbon emissions.

If you're an oil company, stop producing oil.

But guess what?

The people whose money they are using to wield that power are your listeners, are me, are you, are everyday Americans whose money is being weaponized back against them in ways that would make their blood boil if they actually knew what was going on.

That's why.

Well, that's why it is so frustrating.

We just had a secretary of

or the state treasurer of Idaho fold and take a tough ESG bill and just put one in it without any teeth.

And the whole idea was don't invest in

places like BlackRock that are working against the people of our state by is this Julie Ellsworth you're talking about?

Why do you ask?

Oh, that's the state treasurer of Idaho you were mentioning.

Yeah.

I mean, it's just that these are

intentioned people.

They're well, I mean, I spoke to a conference of the state treasurers a couple of months ago, and most of them were in the audience, and I was explaining to them, look, it's not BlackRock's money.

It's not your money either.

It is the money of your citizens that ultimately actually find their way into the public's Fisk, which in turn finds its way into the Fisk of BlackRock, which then uses that money to vote those shares and to whisper campaign in the ears of the top 500 CEOs of this country to say that this is what we as the investors want, betraying the idea that it is not the state treasurer's money.

It is not the, the, actually, it is not the BlackRock manager's money.

It is the money of those everyday citizens.

Now, here's what I'll say about state treasurers is many of their hearts are in the right place, actually.

Many of them are starting to wake up to this phenomenon because they're hearing from their constituents.

Many are.

Unlike BlackRock, unlike Larry Fink, they are politically accountable.

And that is a good thing.

That is how a democracy works.

So that mechanism of political accountability has caused them to wake up.

but they're also accountable to the force of dollars through lobbying and political contributions that pull them in the other direction.

But I think that at the end of the day, they're accountable to the people.

And what we need to educate people on is the fact that it is their own money that they get to vote as well.

Not just vote every November at the ballot box, but their second vote and their third vote come through the capital they spend, the way their shares are voted in the marketplace of corporate America.

And I think that that tide is getting ready to shift.

So I'm optimistic that even though many of these people, it's going to take a lot of courage for the first few state treasurers to sort of jump at the deep end of the pool and go the other way.

But I think that that's what the people are demanding.

And the more we shine a sunlight on the problem, the more we make progress towards the solution.

And I'm personally working on actually creating alternatives in the marketplace here to provide consumers with actually bringing a voice to the table.

I think it's the most important problem of ours.

Thank you.

Thank you.

Thank you.

I agree.

I think

this is it.

I mean, if this is implemented, we become China.

And

it's over.

The freedom that we have, the Constitution means nothing.

And I think the best example of this, and people aren't tying this together,

we're not the ones

that have

decided to go to war against Russia.

These sanctions, these are not governmental sanctions.

This is ESG.

McDonald's pulling out after they said they didn't want to, and then

they announced, I thought this was amazing, that they had real reputational risk that they had to consider.

So they closed McDonald's.

These decisions

are not being made through public pressure.

They're not being made through our elected officials.

They're not being made by people, voters, regular people.

They are being made by the boardrooms after they get the calls from the banks and the financial industry.

Exactly.

And you know what?

This is how both sides are duped into submission, liberals and conservatives.

Liberals used to be skeptical of corporate power, but they've accepted it as corporate powers now used to advance their own objectives.

We conservatives, for our part, are duped into submission because they say the free market can do no wrong

without recognizing that that free market does not exist today.

And both sides are duped to the rise of this woke industrial, ESG industrial complex.

That's actually far more powerful than big government alone because it can work with the private sector to do what big government cannot do.

And I think, Glenn, you're on this, so I don't need to,

I feel a little shy preaching to you, but

I think the defining political force of our time and struggle is not left versus right, actually.

It is the everyday citizen versus the managerial class.

It is the great reset, which calls for dissolving the boundary between institutions globally and say those institutional leaders work together towards their vision of the common good versus what I call the Great Uprising, which is also a transnational movement of everyday citizens who are beginning to say, no, we make those decisions in a democracy together.

It is our voice that matters equally to Larry Fink or anyone else sitting in a corner office.

And those two forces, Glenn, I believe are on a collision course.

You know, we won't see it in 2022 because it's the let's go brand and agenda or whatever in partisan politics in the United States.

That's boring to me.

But in the couple of years after, this is coming to a head.

It is an existential question for democracies in the West.

And, you know, look, I'm on the side of the great uprising, but I want to channel that energy in a productive direction.

Me too.

And I think we can do that.

And I think it's the most important question of our

few minutes ago that Republicans, you better wake up to this right now because the people will go.

If they don't find somebody that's reasonable to lead them and to tell them the truth, I'm telling you, both sides, both sides of reasonable people that work for a living.

I don't care how you voted, they're going to find out what this is all about and they're going to be hurting financially.

And

God help us.

God help us.

We are headed for real trouble.

And you know what?

Vivek, you're the only person that I've heard that really talks about the whole world is in this.

We're so focused on ourselves that we don't understand that Brexit is about the same kind of thing that.

And the truckers in Canada have the same thing in their bones, too.

This is a transpartisan, transnational issue.

And you know what?

I don't have much faith in the Republicans, actually.

I don't either.

And at the end of the day,

most of them are institutionalists.

Most of them are bought and sold, just like the other side.

That's why I think the partisan politics of this is boring.

It misses the issue, almost deflects the issue by retrofitting a model, a historical model, onto a phenomenon right now that's totally different.

It is the everyday citizen versus the managerial class.

And there are members of both parties in each camp.

I mean, you and I both spoke at CPAC.

Tulsi Guevard, she spoke at CPAC.

She ran for president of the United States on the Democratic Party ticket.

She's still, as best I can tell from her comments, on the side of the everyday citizen.

And so there's people, and there's a titan, God knows there's a lot of Republicans on the side of the managerial class.

And so I think that we need to rethink the boundaries.

And I think it's everyday citizen versus managerial class.

It is great reset versus great uprising.

That's the way we need to be recognizing this beyond partisan,

beyond national boundary issue.

And the last point I will make is, Glenn, you're one of the few people who I've heard actually put his finger on the international dimension of this.

You just did a little bit ago, but I think China is really, really an important factor to watch because they understand that capitalism, all right, is the Trojan horse through which they win the great power struggle.

Greece would have never defeated Troy militarily.

China will never defeat the United States militarily.

But they have recognized that the ESG-linked movement creates an opportunity to turn our own multinational companies based here into Trojan horses to undermine our own agenda from within.

And I'll give you a very specific example, okay?

I could give you countless examples.

I talk about countless examples in my book, but a recent one even for my book, not from my book, after my book, is BlackRock.

They take three seats, vote in favor of three changed seats on the board of Exxon, okay?

And they tell Exxon that you need to cut oil production.

Well, they call that ESG friendly.

Let's see what that's done for gas prices here.

Let's see what that's done for our reliance on foreign producers of oil one year later.

But put that to one side.

You think those projects are still going to happen or are they not going to happen?

Whatever you think about climate change and carbon emissions, those projects are still going to happen.

And better positioned to take on those projects are going to be none other than the likes of PetroChina, which can take on the projects that ex-Andras.

And guess who is an almost equally large shareholder of PetroChina?

I'm sure you can guess.

It's the same guys who wanted us to cut oil production here in the United States.

Blackrock.

Unbelievable.

This is unbelievable where at the end of the day, China is able to use capital force, the carrot of market access to the golden goose of the Chinese market, as a weapon to get those same companies to weaken the United States within by applying so-called ESG standards without applying those same standards to China abroad.

And so that's how they're playing this game.

And they're playing us like a Chinese mandolin, and it is working, but it'll only work for as long as we don't see it.

Vivek, I would love to have you on again soon.

You 100% get it, and your voice needs to be heard.

Vivek Ramaswamy, he is the author of Woke Inc.

If you haven't read it yet, you should get it.

Great to talk to you, Vik Vivek.

We'll talk again hopefully soon.

This is the best of the Glenn Beck program, and we really want to thank you for listening.

We've been talking to to David Buckner.

He is a professor at Columbia University.

He's

one of the only professors that I would ever trust, especially from Columbia University.

He is a president of bottom line training and consulting.

He works with companies all over the world.

He has been a guy that has been explaining

the economy and how money works for me for a very, very long time.

Used to see him on Fox News with me.

We were just talking about what has happened because of the war and what's going on with our money.

So let me, I've got three questions for you, David.

Let me start with this.

I keep reading that this war and everything that's going on is

an anti-globalist movement.

But I think that's elite talk because I think what this actually is,

you know, to the average person, it's not anti-globalist.

It is dividing the world into an Axis and allied power, where it'd be the United States and Europe, and then there would be China, Russia, you know, Afghanistan, India, Pakistan, all the way to Saudi Arabia, and God forbid, Taiwan.

And if we lose Taiwan, maybe we lose the southern Pacific as well with Australia.

But that is, there's a group that will have their own economic system and their own way of doing business.

And then there will be the West.

Am I reading this right or wrong?

Well, we're dealing with something right now, Glenn.

You're not wrong in your observations of kind of where it's going.

We're in a position where the United States was kind of the only superpower remaining.

Correct.

And you see many that are observing it, see the division within the United States.

There's so much discombobulation and discomfort in the U.S.

because it's a country that was kind of built on the idea of fighting something.

You know, the whole idea of the founders, etc., was we're here fighting tyranny, etc.

And there was nothing else to battle.

And so there's kind of a psychology of where does the U.S.

go?

And as you start to look at this world, you end, you've always established systems, and systems have worked.

We had a monetary system.

We had a political system.

We had even the United Nations was kind of a system.

And now we're starting to see systems systems cannot, they're not broken, they're circumvented.

Cryptocurrencies have circumvented monetary systems to where we don't have systems that have to be relied upon for people to make exchanges.

You're getting a barter market where they no longer, I mean, Facebook marketplace, you know what I mean?

are being blown up to where either that lends itself to a natural system of chaos, okay, which some would love to have, I'm sure, or a system where a pure market overtakes the old structure of planning.

And you're starting to see with some of the commentary that's coming out of leadership in Russia that they don't want to lose their,

I mean, even that the leader has suggested he doesn't want to lose his position.

He wants to go back to the old Soviet Union in some ways, but I don't know if he's seeing that you can't un-market something.

It becomes a black market, perhaps, but you can't unmarket it.

Well, they're not a market.

I think that's why we're talking about,

you know,

a digital programmable dollar from the Fed, because they think they can kill the black market.

They can control it all the way down to

the very bottom level.

But that would assume adoption.

That would assume that we all adopt that.

You're finding the youth of today, Glenn, they don't have bank accounts and they don't carry currency.

Now, to your point, they use digital exchange, Venmo, and other things, right?

Right.

So they may be being wooed into a system that could be monitored.

But I dare venture that I'm not sure that they're being wooed into a system that, and it could be manipulated as well, to be fair.

But I'm not sure as soon as they were to find that that system is being managed, they might adapt to a different system.

You're finding more pure market movement

that you would have to adopt a digital currency.

And people would have to assume that that's the only mechanism by way we would exchange for that to be truly as viable and productive as many of those that are building it would say.

So you're seeing movement in this market, which is really quite fascinating.

And it's disconcerting for those who want control.

It's disheartening for those who think they're going to be controlled.

And it's enabling for those who think, oh my gosh, if this doesn't work, I can try something else.

I mean, you go from, you know, if you go to social media, it used to be Facebook, and then it went to,

now you're getting snap and now you're getting everybody moves.

They keep moving, moving, moving away from less control to more individual control.

So that may be the one redeeming component of all this.

David,

do you agree that we are operating now in the United States under modern monetary theory?

We are moving away from traditional structured monetary components.

That's the way I identify it because while

the monetary structures are in place, they're less relevant today than they've ever been.

And that changes the whole dynamic and the conversation.

When you say liquidity, the youth of today,

there's just no mindset around, I've got to go to a bank, I've got to show my credit rating.

I mean, they're Venmoing each other loans all over the place.

That's a completely informal market.

And that's the way it's going to transform exchanges globally.

I'm talking not just in our neighborhood, global transactions and cryptos are going to play into this a bit to the degree we don't know, okay?

But it's going to deep, it's going to remove the formality.

So, to your question, yet.

So it will remove, it will

remove the formality unless the nations decide they want that control.

And they're moving that way through ESG, whether they can actually pull it off before people rise up and go, whoa, whoa, whoa, whoa, whoa, wait, what?

You know, that remains to be seen.

I accept that.

I accept that, Glenn, with this exception.

In many countries that are highly planned, where I've been, I mean, you know, we've been friends for a long time, and the number of countries I've traveled that are

supposed to be planned.

They're supposed to be very closed and structured.

And to be fair, I've not been to places that are closed, okay?

Right.

But the ones that are highly planned are more market internally than you'd ever imagine.

Now, we would call it a black market, and they might even call it an observed market, because as long as they don't disrupt the governance,

they allow them to occur.

But they're highly

market-driven by barter systems.

So even with this, can they control us,

I think

the box is open

and you can't un-market a place.

It will be a black market, but we don't have the controls that we once had or the closed borders or the boundaries or the walls.

You can't even build a wall anymore around a marketplace when you have a mindset of a Venmo use of today that can exchange in 15 seconds something that we used to have to transfer through transactions and a bank.

They don't use a bank.

They're using these clearinghouse mechanisms that are

so fluid that they don't understand really that you actually have to have one centralized look.

That's why some of these crypto conversations are so fascinating is because they've overtaken the structure.

And to your point, can we re-box that?

I don't know.

I don't think so.

I think you can until it hits critical mass.

And I don't know what that number is, that market cap is.

But as soon as you have

too many people with way too much money into it, then

I don't think you can put it into a box.

David, last question.

I've only got a couple of minutes.

Your thoughts on inflation and where we're headed.

Well,

we're dealing with a debt that is frightening.

The $30 trillion with the debt ceiling that continues to increase.

increase, we're double spending every year.

And anytime you hear leaders suggesting that they're going to reduce our deficit by a trillion, they don't explain the fact that we're spending $4 trillion more than we're taking in.

So reducing that down to only spending $3 trillion.

The expenditures, the inordinate amount of expenditure into the economy, in the name of what we've gone through, which is COVID, and

the reality of that is

organically setting us up for a significant hit on inflation.

It's not just a check mark for 15 seconds.

We're dealing with significant inflationary pressures.

And now you're going to start seeing that that will increase, especially with interest rates and other things dominoing.

I worry for the next period of time that the disparity between rich and poor will become even greater because those who hold property where real estate goes up in an inflationary time and those who are renters where rent goes up and they can't pay for it, that disparity gap is going to be enormous, creating even greater problems and discomfort on this inflation.

So it's real, Glenn.

It's real.

Thank you, David.

It's good to talk to you again.

Thank you so much.

Yeah, God bless you.

God bless you.

My best to your family.

David Buckner from Columbia University, don't hold that against him.

He's the guy who I met years ago who came up to me at

some

event, and he walks up to me and, of course, at the food table, and he said,

where'd you get your economic degree?

And I thought, you

I said, I don't have one.

He said, I knew it.

And I was about to punch him in the face.

And that's when he said, I cannot get my students to think like you.

He said, you've got to think out of the box.

And this higher education, all it does is put you in a box, put you in a box, put you in a box.

And the only way you see trouble is if you don't think that way.

You know, that's a good David Buckner story.

And of course, the David Buckner story, maybe most famous, is the one where he passes out on Fox News.

However, my favorite David Buckner story

is when we did a stage show and you were going to explain the economy and you decided you were going to explain it like the economy was a car.

It was a convertible.

And

you had this grand, of course, you're getting us to run around and try to find a convertible like 10 minutes before the show.

They bring out this old school convertible and David Buckner is going to be part of the show.

He's going to help explain the economy.

That's right.

And so, I don't know, 15 minutes before the show, thousands of people out there all in their seats.

You decide,

instead of me calling out David, you know, a little, you know, a half an hour into the show like I was going to, what I'm thinking of doing is I'm going to just have him out there and I'll just bounce ideas off of him the entire time.

We'll go back and forth.

And David, I want you to just come out and you just start in the car.

You sitting in the convertible on stage and then I'll just go back and forth with you the whole time.

And he's like, yeah, absolutely, Glenn, whatever he needs.

So he goes out there.

he sits up, the camera,

the curtain goes up.

Yeah.

David Buckner, this economist that no one, you know, they know him from the show, maybe, but like, you know, they don't know why he's sitting in this car.

Or why the car is there.

Or why the car is even there.

So Glenn comes out, does a totally unrelated monologue for like 45 minutes without introducing David at all.

Or the car.

Or the car.

So there's just a car with a guy sitting on stage with no explanation for the entire show.

The curtain goes down and then, oh, sorry, David.

I'm sorry.

I never got to him.

I don't think you ever got to him and asked him a question the entire show.

Oh,

David, I don't know why you're still my friend.

I don't know either.

I apologize for that.

The best of the Glenbeck program.

Carol,

welcome to the Glenbeck program.

Hey, Glenn, lots of things to talk about.

Yeah, boy, I've got a long list for you, too.

So let's start with what happened yesterday and why people should care.

So I want to take a step back and talk about why the Fed did what it did in terms of raising interest rates, what we call 25 basis points or a quarter of a percent.

100 basis points is 1%.

And basically, they were undoing the

or at least attempting to start to undo the effects of what they in part cost.

Their monetary policy, zero interest rate policy, printing trillions of dollars, the government spending trillions of dollars in terms of fiscal stimulus, turning parts of the economy off and wrecking the labor market and the supply chain.

All of those things are the reasons we have inflation today exacerbated by decisions that the biden administration made around oil and gas dependence and whatnot so basically we had inflation which we've all been talking about and seeing as we go to the grocery store and certainly at the fuel pump and whatnot and so finally they said we have to do something now i'm going to tell you this is a little bit of window dressing because they were doing accommodation they were in the market purchasing securities last week so last week they were being accommodative, but this week we have to maintain our credibility and we need to do something.

So they decided to raise what is called the Fed funds rate.

It's a rate where banks lend to each other overnight in terms of their reserves and that reverberates through the market.

So they had brought that down to a target of zero to a quarter of a percent and they had held it there for the last couple of years and they said okay well you know inflation is getting away we better raise some interest rates one of our tools in order to do that.

And they took the huge step of a whole quarter of a point increase to do it.

Yeah, very, very, very meaningful because they need to be credible.

Right.

The last time we had this problem of this size, it took an interest rate of about 19 or 20%,

if I'm not mistaken.

Raising it a quarter

is really

is a joke.

Where do you think these interest rates should be?

Not considering killing the economy, just where it should be.

If we were in a healthy country still, would it be 20% or more?

So there are a couple of things to unpack there.

First of all, this is an unprecedented situation.

We don't have a benchmark because we've never had central banks, not just in the U.S., but around the world, printing trillions upon trillions of dollars.

This has just never happened before.

And we've never had governments turn off the economy.

You never have a situation where there's 1.7 jobs available for every job seeker because of what the government did.

So we're flying a little bit blind.

I've always been a fan of normalized interest rates.

I think it's a horrible idea to have the Fed meddling and trying to direct things.

I want the market to set it.

And so before all of this nonsense started, before the financial crisis, the Great Recession financial crisis in 07, 08, which was really the first time we went totally off the rails with the zero interest rate policy and the purchase of securities.

The interest rates were around

five plus percent.

And that seems to be a healthy place where things should be.

We should not be in a place where we're saying

when you take risk, you shouldn't be getting rewarded for it, 0% interest.

It makes no sense.

So in reality,

we're still at very historically low interest rates.

And in a healthy economy,

to have three, four, five percent would be completely acceptable.

We just have been so addicted to this easy money and this free money for so long, I'm not sure how we get out of it.

Okay, so there's a couple of problems with 5% interest rates right now.

One would be that people would not be able to afford new house, et cetera, et cetera, because of inflation and everything else.

But the other that nobody ever talks about is we now have a national debt over $30 trillion.

And that is just like buying a house.

You have an interest rate on that.

If we had an interest rate of 5%,

how much more money do we have to pay?

Bingo, this is the dilemma that the Fed has gotten themselves into by keeping down interest rates.

They've basically given the government a free pass to just spend and spend and to rack up more and more debt.

And we're at a point where the debt is completely out of control and has exceeded our level of GDP.

So, if you think about 30 trillion of debts, and obviously the Fed funds rates and the interest rate on the debt isn't a one-to-one correlation, but we know that as one moves up, the other moves up.

So, in terms of the interest on our national debt, I want everyone to pay very close attention because this is staggering.

For every 1%

increase, that is another $300 billion

that we have to pay in interest on the national debt.

That is our tax dollars that are going to pay more for things that we have already purchased.

It is not new purchases.

It's literally a finance charge, a almost like credit card interest rate on stuff we have already bought.

And this is the dilemma the Fed has because they know as they raise interest rates, this is going to get out of control.

The CBO had made a projection saying that this is going to get out of control.

But in their projection, they said, well, you know, we think the yield on the 10-year treasury note gets to about 2.1% in 2025.

So we're going to have to really be concerned maybe in 2029.

The yield on the 10-year treasury note is at that 2.1% today.

So multiple years ahead of time.

Please talk down to me like I'm in kindergarten.

I don't understand the yield thing with the treasury, how that works, how that's affected.

So can you explain that?

Yeah, so basically it's how much the government has to pay on the debt, on debt.

So it's what the market demands.

And obviously,

if there is a lot of demand for treasury securities,

the prices of that go up, then the yield or the interest that you demand is lower because there's a lot of demand.

You don't have to pay a lot for your debts.

But we had been at very,

very, very low, even because the Fed was buying up.

There was no demand for our treasuries, which is our loan.

So let me put it in context.

What we are paying currently on our national debt in terms of a combined interest rate is somewhere in the neighborhood.

I've seen projections of 1.4% to 1.6%.

So they've been able to finance that at a very low rate, but that number is starting to creep up.

And with the Fed increasing interest rates, it will further creep up.

And every 1%

is $300 billion.

So if we have an interest rate of

5 or 6%,

we're talking like between $2 and $3 trillion more, the entire budget.

Exactly.

It's just completely untenable at that point in time.

So

I would imagine other things happen in the interim.

But this is why when we talk about things like MMT modern monetary theory, or what I call it, magic money tree, that says you, well, you can just print into infinity because we can just print more.

Well, we are now living through that real-time experiment.

As we've all said, no, you can't.

It causes inflation.

It has real costs for the average American, and it decreases the value of every dollar that you hold.

All right.

So the best thing you can do is get out of credit cards.

You should cut those up if you can and pay them off if you can, get a refi right now because you're probably paying about 16% for your credit cards, correct?

Yeah, I mean, and it could be going up.

And anything that has that adjustable interest rate associated with, some people may have something called an arm and adjustable rate mortgage where it's, you know, it adjusts over time.

Maybe it's fixed for a certain number of years, but then it starts to float.

Anything that is adjustable rate debt is going to increase in price.

And if you need financing, let's say you have a business and you haven't taken advantage of low rates yet, you're going to want to lock that in on a fixed basis now because it's not going to get cheaper anytime soon.

Now, the other problem, the problem with raising interest rates is, let's say you have a business and you need a loan.

If the interest rates start to go up, that kills that business.

They can't afford that loan, just like we can't afford our national debt.

Or you want to buy a house.

Yesterday, mortgages, new mortgages fell immediately, or just on the whisper that it was coming.

We are seeing a slowdown in mortgages, which means that people are going to buy fewer houses.

The scary thing about this is you don't know where that switch is.

You just kind of have to guess, and it might shut everything down.

That's the needle that the Fed is trying to thread in addition to dealing with the consequences of the national debt.

What happens is as they raise interest rates, their intention is to slow down the economy.

I mean, that's basically what it is.

They want to slow down consumer demand.

But the question is, how do you do that without creating a recession or without creating reverberations for the economics of the average American?

Can I be really, really cynical?

I mean,

in fact, let me go beyond cynical.

Let me go into, I'm a thriller writer, okay?

And I'm writing a thriller.

And for some reason, this country needs to slow down the economy, but they can't slow down the economy because then businesses will fail.

But they don't really care about the average person.

You know what I mean?

That's going to fail.

That's fine.

We'll print more money.

We'll put them on welfare or tell them to stay home or whatever.

Wouldn't one way to slow the economy for the consumer, but not slow the economy for the big corporations,

would a war

do that?

I think that would completely change the tenor of the economy.

But I think that raising the interest rates does that because kind of like we saw over the last couple of years, if you are a big corporation, you've taken advantage of that debt.

You have that war chest.

You have that strong balance sheet.

So in terms of the transfer of wealth,

that is one way to do that.

But the war,

that would completely change the tenor of

who benefits.

And certainly it would be the bigger guys versus the smaller guys, but it would probably be folks in defense rather than the financial services industry, for example.

All right.

So I want to talk to you about the dollar being the world's reserve currency

because I'm watching the sanctions that are being put on and I'm seeing things happen to where if I'm another country, especially Russia, I'm going to China immediately saying, I want to partner with you because they just made my money worthless.

I can't get my money out of the central bank, the Federal Reserve.

That's my money.

And they won't let me get to my money.

If that starts to happen and then Saudi Arabia starts to sell oil off of the petrodollar, that's really bad news.

And let's say the West holds together, but half the world is off the petro dollar.

What does that mean for us, Carol?

It potentially means the end of the US dollar as a reserve currency

explain what that means because okay so I mean to the average person forget about you know the central banks and everything else what does it mean to the average person to have half the world get off our dollar ship them back

so so this is why I love you Glenn is because we take the most complicated concepts in the world and try to explain them as if you know it's Elmo and Big Bird here the idea of being the reserve currency is something that

has sort of long history and it means particularly in the case of goods and services, but also in the case of oil, that everyone in the world pretty much agreed to use dollars for settlement.

And that puts some responsibility on the United States.

There's something that is called the Triffin dilemma.

And it's an economist back in the 1960s who basically said, there's a conflict.

If you are going to be the world reserve currency, you're going to have to make tough choices and you're not always going to be able to do what's right at home in order to make sure you're doing what's right in the national sphere.

Yeah.

And unfortunately,

this has been an issue that's been going on for a long time.

But in recent times, as we've been talking about with the Fed and the decisions that they've made, they actually haven't done right by either party.

They've been screwing over the average American with their policy and transferring wealth, but they've been doing the same thing in the national sphere.

And frankly, a lot of countries are getting sick of it.

And so there have been predictions for quite some time that there was going to be an event.

An advisor actually to the OECD said that it's probably not an economic event, it's a geopolitical event that's going to expose this system, you know, wink, wink, nudge, nudge.

And so a lot of folks feel like the sanctions that were made against Russia were potentially a cover story that we know we are potentially going to lose this reserve currency status.

So we're going to say, well, we did it because we had to take a stand.

But the reality is, you know, as we've now shown the world, you can put your money in our central bank and you can buy treasuries and US dollars and hold them, but you might not be able to access them, which is not a really good thing if you're going to be the world's reserve currency.

So there are a couple of potential outcomes.

And I know that you've been talking about this, Glenn.

But one thing that folks have been talking about is does China potentially step into the reserve currency position?

There is an issue around that because usually if you have the reserve currency, you run a trade deficit.

And we know that China is a nation of exporters.

So, are they really going to step into that?

I'm not sure.

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