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Inside America's Debt Crisis: How Politicians Are Sacrificing Your Future Peter Schiff Pt. 2 - - Tom Bilyeu's Impact Theory | Wave AI Podcast Notes

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Inside America's Debt Crisis: How Politicians Are Sacrificing Your Future Peter Schiff Pt. 2 -

Tom Bilyeu's Impact Theory

Wed Oct 29 2025

Summary

Podcast Summary

Podcast: Impact Theory
Host: Tom Bilyeu
Episode Title: Inside America's Debt Crisis: How Politicians Are Sacrificing Your Future – Peter Schiff Pt. 2
Date: October 29, 2025
Guest: Peter Schiff (Economist, Author, Financial Commentator)

1. Overview

This episode features the second part of Tom Bilyeu’s in-depth interview with Peter Schiff, tackling America’s soaring debt, the political gamesmanship exacerbating the crisis, and the fierce cultural debates over Bitcoin, gold, democracy, and the U.S./China rivalry. The conversation is lively, skeptical, at times combative, and rich with macroeconomic insight, libertarian critique, and concerns about the nation's future.

2. Key Discussion Points and Insights

A. America's Debt Crisis and Its Consequences

Debt-to-GDP Thresholds: Tom kicks off (00:23) warning that debt exceeding 130% of GDP leads to societal collapse, referencing historical precedents.
- “You end up with civil war or revolution... People always think that I'm being hyperbolic... but you just run into the realities of what happens when you can't do funny money.” (Tom, 00:23)
Government Inaction and Inflation: Peter argues politicians will never honestly default or cut entitlements but will erode benefits through inflation (01:33).
- “So yes, you're going to get your Social Security check, but good luck buying something with it. What good is a Social Security check that doesn't buy anything?” (Peter, 03:45)
- Proposes means testing Social Security, favoring the truly needy.

B. Bitcoin vs. Gold Debate

Peter’s Stance: Bitcoin lacks intrinsic value and is poised for a major crash; mainstream investor FOMO, not true believers, has driven its appreciation (03:45, 07:12, 08:46).
- “Bitcoin is nothing. It generates nothing. It has the potential to generate nothing. It's just a digital string of numbers, right?” (Peter, 02:13)
- “The narrative that bitcoin is digital gold is being disproved right now... you’re going to see mass liquidation as people try to get out of the casino, but there's no exit.” (Peter, 03:13)
- Predicts a crash to $10,000 and suggests waiting to buy until after “MicroStrategy is bankrupt” (09:09).
Tom’s Rebuttal: Psychological store of value is what matters; young, digitally native generations see Bitcoin as valuable (04:43).
- “When I hear you tout... gold is a real thing. It has real value... That literally means nothing to me... I think of gold as being totally worthless other than what somebody else will pay.” (Tom, 04:43)
- “The frame of reference that they have is that bitcoin is a valuable thing... more and more people are going to go into crypto, into bitcoin specifically.” (Tom, 10:04)
Dialog on Utility and Subjectivity: Both challenge each other on utility (“You can’t smoke bitcoin”) vs. consensus-based value (“the vast majority of the value of gold is that we all agree... Cool, I’m going to do gold.”, Tom, 18:11).
- “The storage of value is merely a psychological construct... we've used shells and glass beads and all kinds of shit...” (Tom, 16:50)
On Third Party Risk (Gold Custody): Tom expresses distrust storing gold; Peter highlights Brinks’ 165-year track record (21:16).
Political Intervention and Bubbles: Peter warns against politicians channeling money toward Bitcoin or any asset for personal or political gain, using Trump’s pro-crypto stance as an example (62:00–65:47).

C. Democracy, Republic, and the Rise of Socialism

Flaws of Democracy: Peter critiques democracy, favoring a Republic designed to limit majority rule and government power (29:25–30:22).
- “A democracy is two wolves and a chicken voting on what to have for dinner. A republic is a well-armed chicken who challenges the vote.” (Peter, 30:22)
- Notes that voting was not seen as a right in the U.S. founding documents.
Mob Rule and Populism: Argues the more democratic America becomes, the more susceptible it is to socialism and populist policies as economic hardship grows (29:59, 34:00).
- “The promise of socialism is very seductive... but everything the socialist promises, the opposite is what's gonna get delivered.” (Peter, 35:40)
- Nazi and Occupy Wall Street references to show how economic pain paves the way for extremism and demagogues (37:30).
Dependency and Political Incentives: “Once the government can make you dependent on a government check... now you vote for whoever promises to continue providing the crutch.” (Peter, 41:04)

D. U.S. Housing, Interest Rates, and Solutions to the Debt Crisis

Trump and Interest Rates: Peter claims Trump seeks low interest solely to sustain bubbles and prevent immediate collapse, but the market won’t finance the government at those rates (23:02–25:24).
- “The free market solution to that problem is lower home prices... So your monthly payments will be lower because the principal is lower. But of course, if we let real estate prices fall, banks could fail.” (Peter, 23:49)
Default, Not Inflation: True solution is to default on debt—take the pain now, allow a haircut for creditors, and move forward—rather than endless inflation which erodes value invisibly (25:20).
The Government’s Political Calculus: Pain delayed is more politically palatable; thus, harmful inflation is inevitable over politically difficult default or rational spending cuts (26:10).

E. U.S.–China Rivalry and the Future

China as a Rising Power: Peter asserts that China’s position as creditor and exporter, not the U.S. as debtor and consumer, will dictate global power; future is structurally tilted toward Chinese dominance (50:50–56:36).
- “China is going to emerge on top... the dominant economic and probably military power for the majority of the 21st century.” (Peter, 56:36)
America’s Decline: U.S. trade imbalances and policy missteps will hasten the shift; unless there’s radical market liberalization and rollback of the state, America won’t regain the lead (58:00).
Trade Wars Are Self-Defeating: Tariffs hurt American consumers, not the targeted countries (“We pay the tariffs. The tariffs are on American consumers,” Peter, 55:00).

F. Corporate Greed, Regulation, and Minimum Wage

Market Forces Over Regulation: Peter welcomes “corporate greed” as the driver of better, cheaper products and is skeptical that regulation serves the public, as the market rewards or punishes companies longer-term (45:06).
- “Corporate greed is what makes my life better... greed, when it's channeled into profit maximization, is a good thing.” (Peter, 45:06)
Controversial View on Minimum Wage: Minimum wage laws harm the unskilled and young by pricing them out of the labor market, exacerbating dependence and hindering skill development (48:04).

G. What Should Politicians Be Allowed to Invest In?

Potential for Corruption: Peter argues politicians may invest in anything, but only if they cannot influence government policies for personal gain—true only under strict Constitutional limits (65:51).
- “You take the power away from government, you're never going to be able to prevent corruption in government... make it so that corruption doesn't pay.” (Peter, 65:51)
Weaponizing Government/Trump’s Example: Critiques Trump for using tariffs and economic power to benefit friends/family and argues no government figure should wield such leverage (66:50).

3. Notable Quotes & Memorable Moments

On Social Security and Inflation:
“You're going to get your Social Security check, but good luck buying something with it.” (Peter, 03:45)
On Generational Views of Bitcoin and Gold:
“The frame of reference that they have is that bitcoin is a valuable thing... more and more people are going to go into crypto, into bitcoin specifically.” (Tom, 10:04)
On Store of Value:
“The storage of value is merely a psychological construct... we've used shells and glass beads and all kinds of shit.” (Tom, 16:50)
On Democracy vs. Republic:
“A democracy is two wolves and a chicken voting on what to have for dinner. A republic is a well-armed chicken who challenges the vote.” (Peter, 30:22)
On China’s Future:
“China is going to emerge on top... the dominant economic and probably military power for the majority of the 21st century.” (Peter, 56:36)
On Corporate Greed and Capitalism:
“Corporate greed is what makes my life better... greed, when it's channeled into profit maximization, is a good thing.” (Peter, 45:06)

4. Important Timestamps

00:23 Tom on debt-to-GDP history and societal crisis
01:33 Peter on inevitable inflation and Social Security
03:45 Peter: "What good is a Social Security check that doesn't buy anything?"
07:12 Mainstream adoption drives the Bitcoin bubble
09:09 Peter: “I wouldn't even consider buying bitcoin until after MicroStrategy is bankrupt”
16:50 Tom on value as psychological construct
21:16 Peter discusses Brinks and third-party gold storage
30:22 The republic vs. democracy analogy
35:40 Peter: “The promise of socialism is very seductive”
45:06 Peter on corporate greed as a force for good
48:04 Minimum wage laws harm low-skilled youth
50:50 U.S.–China trade and global power shift
56:36 China’s outlook and U.S. decline
65:51 Politicians, investments, and constitutional limits

5. Flow and Tone

The episode maintains a spirited and occasionally contentious tone, with Tom pressing Peter from a tech-centric, digital-native viewpoint and Peter responding with classical economic conservatism and historical context. Both are frank—sometimes profane (“get the fuck out of here,” Tom, 04:43)—and unafraid to voice controversial opinions on economics, policy, and generational division.

6. For Further Engagement

Peter Schiff:
- Podcasts: shiftradio.com
- YouTube: Peter Schiff
- X (Twitter): @PeterSchiff
- Asset Management: europac.com
- Newsletter: shiftsovereign.com
Host:
- Tom Bilyeu: Impact Theory, impacttheory.com

This episode is a must-listen for anyone seriously concerned with macroeconomics, Bitcoin, generational finance debates, and shifts in geopolitical power.

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Transcript

A (0:00)

Oh, the car from Carvana's here. Well, will you look at that. It's exactly what I ordered.

B (0:07)

Like, precisely. It would be crazy if there were any catches.

A (0:12)

But there aren't, right?

B (0:13)

Right. Because that's how car buying should be with Carvana. You get the car you want, choose delivery or pickup and a week to love it or return it. Buy your car today with Carvana. Delivery or pickup fees may apply. Limitations and exclusions may apply. See our seven day return policy@carvana.com I'm Tom Bilyeu and this is Impact Theory. Let's jump right back in to part two of my conversation with Peter Schiff. Yeah. The exact thing that I've been trying to get people to hear is that every country with the exception of Japan that has crossed 130% debt to GDP tears itself apart from the inside. You end up with civil war or revolution. People always think that I'm being hyperbolic or I'm just being paranoid. But the reality is when you start describing the mechanisms that would have to be in place for these kind of drawdowns to happen is, I mean, you're, you're not able to fund a bunch of programs. So you literally have to go into the government and say, well, these things just aren't going to get paid. Checks start bouncing. You just run into the realities of what happens when you can't do funny money. Essentially.

A (1:22)

Yeah.

B (1:22)

And that, yeah, that, that is going to get bad. And then you're going to take the populism that we have now and you're going to exacerbate it a thousand fold. And that's when suddenly the left and the right go from hating each other to actually killing.

A (1:33)

Yeah. And you know, this responsible thing is for the government to admit that it's broke and that it can't afford the promises that it's made and to cut government spending, including entitlements, to be honest with the voters and say, you know, we can't pay you the Social Security benefits that we promised. And so we're not going to. We're going to either. Maybe we're going to make the retirement age 85 instead of 65. Right. You gotta keep working. Unfortunately, you know, we told you you could retire at 65, but we don't have the money. You know, there's a lot of things that America should do, but we're not gonna do that. So instead we're gonna create massive inflation so that the Social Security payments are worthless. So, you know, I mean, my, my, my solution is, means Testing it so that at least the poorest people who really need Social Security could get something. And wealthy people like, like, like I don't need any Social Security. You could simply say, peter, you get nothing. I mean, I don't need the money, right? And so the more people who you tell you get nothing, then the people that really need it will get something. But the way they're gonna do it, they're just gonna wipe out benefits so that my loss is the same as everybody else's loss. Cuz it's all gonna be inflation. And this is the worst way to deal with it. But politically that's what we're gonna do. We're gonna, we're gonna destroy the value of Social Security by destroying the value of money. And so yes, you're going to get your Social Security check, but good luck buying something with it. You know, what good is a Social Security check that doesn't buy anything? Right? So but the politicians are never going to act responsibly. But also, you know, and I got to throw this out there because I know a lot of people are watching and they're listening to this, they say, yeah, that's why I own bitcoin. I'm ready for this because I got my money in bitcoin. I got news for the bitcoiners. The bitcoin crisis may hit before the dollar crisis. We could see a complete implosion in bitcoin even before the dollar. And I think bitcoin right now as a tech stock, well, it's not even a tech stock because at least the tech stock is a business that has the potential to generate income. Bitcoin is nothing. It generates nothing. It has the potential to generate nothing. It's just a digital string of numbers, right? But bitcoin is right now in a big bear market and nobody knows it's down more than 25% priced in gold since August. And in fact bitcoin was down again today, even as gold hits new highs and silver hits new highs. So I think the narrative that bitcoin is digital gold is being disproved right now. And I think a lot of people who bought bitcoin in the last couple of years through exchange traded funds are going to be getting out. And I think what happened on Friday in the crypto market and in bitcoin, that flash crash is a warning about, of what's about to happen. And what's going to happen next is going to be much worse. And it's not going to be triggered by a social media post. And there's not going to be a bounce back. I think you're going to see mass liquidation as people try to get out of the casino, but there's no exit. There's not enough liquidity.

B (12:20)

I'm never going to be able to convince you because you know these, you know these answers. It is taking a short break, but there's more Impact theory after. Stay tuned. If you're tracking your health in a serious way, you know the problem. One app for sleep, another for nutrition, a third for fitness, a fourth for recovery. You are juggling five different platforms just to get an incomplete picture. That ends now with Bevel. This is the all in one health tracking solution that I have been waiting for. And that is why it is on my phone right now. Sleep, nutrition, habits, recovery, stress, fitness, everything consolidated in one place. What's really exciting about Bevel is that the AI is proactive. It does not just sit there waiting for you to ask questions. It is analyzes your metrics in real time. It holds you accountable to your goals. It remembers your lifestyle and tailors every suggestion specifically to you. And your data stays private. Everything is stored on the device, not on servers. And if this sounds awesome, head to Bevel Health Impact and use Code Impact to try it free for an entire month. That's B E V E L Health Impact and use Code Impact. Most entrepreneurs pick a platform that works great at launch but breaks when they grow. You start small, gain traction, then you hit a wall. Now you're migrating platforms mid growth, losing momentum, losing sales, and rebuilding everything from scratch. Smart founders though, start with the end in mind, from the beginning. And that's where Shopify comes in. Whether you're making your first hundred dollars or your first million, whether you're testing your first product or processing thousands of orders daily. The platform of Shopify is going to grow with you. Stop betting on platforms you know you're going to outgrow. Build for scale from day one. Sign up for your $1 per month trial and start selling today on shopify.com/impact. Go to shopify.com impact again shopify.com impact let's talk about the hidden cost of DIY when you're running a business, most founders think they're saving money by piecing together their own financial system. But that DIY approach isn't saving you money, it's costing you money. Every hour you spend switching between systems is an hour not spent growing your business. Found consolidates everything into one business banking platform. Expense tracking, invoice management, tax preparation, virtual cards for different spending goals, all in one place. Open a Found account today for free at F o u n d dot com. Found is a financial technology company, not a bank. Banking services are provided by lead bank member fdic. Don't put this one off. Join thousands of small business owners who have streamlined their finances with Found. This is a paid advertisement. Thanks for staying tuned. Now let's get back to it. For someone like me, it is where would I rather have my store of value? In Bitcoin, which I feel like I control, or in gold, which is going to sit in somebody else's vault? Because I'm sure as hell not burying it in my backyard. I'm not putting it in a safe in my house.

A (23:02)

Yeah, well, he doesn't understand that that's the problem. You know, he's looking at the President Understands, you know, maybe, I mean, but he certainly does a good job of lying about it right now. And so you never know with politicians or central bankers. Are they ignorant or are they just lying? I mean, and I don't know. And sometimes it's hard to know what's worse, right, if they're lying or just, you know, ignorant. But Donald Trump looks at a problem that we've got a lot of debt, and so we have a lot of debt. We need low interest rates so we don't have to default. He looks at the housing market and sees a situation where houses are so expensive and people can't afford them. And in his mind, well, how do we make these expensive houses affordable? Well, let's make mortgages cheaper so people can go borrow more money at a lower rate to buy these houses. Right? But the free market solution to that problem is lower home prices. Obviously, houses are too expensive. Let the price come down right? Then people can afford them. People won't have to borrow as much money. So the interest rate doesn't have to be that low because your loan balance is a lot lower. So your monthly payments will be lower because the principal is lower. But of course, if we let real estate prices fall, banks could fail, right? People's home equity disappears. And so Trump thinks we just need lower interest rates so we can sustain a bubble in housing. And so the U.S. government, which right now we're spending, you know, a trillion two, a trillion three every year on interest. And by next year we'll be spending 2 trillion a year, which will be, you know, 40% of our tax revenue. And if it keeps going, you know, it'll be more than that. And Trump understands that the economy is going to implode under the weight of all this debt and we're going to be spending all of our money just on interest, on what we've borrowed and there's nothing left over to do anything else. So Trump says we need lower interest rates so that we can service this debt.

A (25:24)

Not for people will buy 30 day treasuries, maybe a one year. But they're not going to lend us money at 2% for 30 years or even 10 years. You can't do it. But Trump just wants the Fed to lower rates so that we can borrow more money short term to get the rates down. But that's just going to make the problems, the underlying problems worse because it's artificially low interest rates that are the source of the problem. And so you can't cure the problem by making it bigger. But what we do need, the solution, is to let interest rates go up. The way we solve the debt problem is we default. That's how we solve it, right? How does somebody. If you're an individual and you've just borrowed too much money, right, and you can't possibly pay it back, what do you do? You declare bankruptcy, right? And then you reduce your liabilities, you give all of your creditors a haircut, right? Hey, Peter, you. Everybody loaned Peter Schiff a bunch of money. Peter's broke. He can't pay everybody back. Let's just go into bankruptcy. Let's figure out what Peter's got and we'll figure out how much he can afford to pay, and then we'll figure out what everybody gets. And. And that is the solution that we need. We need the US Government to basically have a moratorium. Hey, we can't pay. We borrowed too much money. We can't pay the bondholders, we can't pay the Social Security, we can't pay the pensions on government retirees. We're basically going to have to give everybody a haircut. We're going to have to figure out, you know, we have a $38 trillion debt. We can't afford that. Maybe we can afford a 10 trillion. We got it, we got it. We got to have a default. That is the honest way to go about doing it. Now you might say, well, that's terrible. People that own Treasuries, somebody that has $1 million in treasuries, they're only going to have 400,000. Yes, I get it. They lost $600,000. But the way we're going to do it, they're not going to default. You're going to have your million dollars worth of Treasuries, but it's going to feel like 100,000, because 90% of your purchasing power is going to get wiped out through inflation. So a much better solution to the problem of too much debt is default, right? A better solution to overpriced homes is, is to let the prices go down. But when you do, the real, the good solution, the pain is immediate and the outrage is immediate. People are very pissed off that they lost this money. So the Government would rather have them lose more money slower than less money right away. And of course then they can blame somebody else. They can blame, you know, the speculators, or they can blame capitalism. They can blame greedy corporations, which of course is what they're going to do. Right. The government never accepts responsibility for the problems it causes. It always blames capitalism for those problems. So it could use that to make itself bigger and to hold itself off as the solution. See, this is why we got to get rid of capitalism. This is why we need more government, because we have to prevent these disasters that capitalism creates.

A (30:22)

Yeah, so I mean a very easy and kind of, you know, definition is a democracy is two wolves and a chicken voting on what to have for dinner. You know, a republic is a well armed chicken who challenges the vote. So the idea behind a republic is that the majority could Be just as oppressive as one person. Right. So if you're in the minority and a majority of people decide to oppress you. Right. You don't really care. That's no different than having a monarch oppress you or a dictator. Right. And so you don't want to allow a group of individuals to take away the rights of a smaller group because they outnumber them. So the whole purpose of a republic is to protect the minority from the tyranny of the majority. And so how did the founding fathers, how did they do this? Right. Well, from the federal government. And remember, because the U.S. america was initially a collection of 13 independent countries. So all the initial 13 colonies that became states, they all had their own constitutions and their own government, but on a federal level. Right. The way the federal government was organized, it was organized in a way to be very undemocratic. So first of all, the president was not elected by the people. The President was elected by the electoral college and the electoral college. You know, there were various ways to, you know, get the electors other than just popular votes. But it wasn't the people who were voting for the President. It was the people who were voting for electors who were supposed to convene and make decisions and evaluate the candidates and then vote. They weren't supposed to be a rubber stamp of what, you know, of what the people wanted. They were elected to exercise their own judgment. The senators were appointed by the state legislators. They were not elected by anybody. They were appointed by state legislators. Now, those state legislators may have been elected, but the senators were appointed. And they were appointed for six year terms, and their terms were staggered. And the reason that they were staggered so that only one third of the Senate would turn over was because they wanted to make sure that if there was a popular movement that at most it could capture a third of the Senate, that it couldn't, you know, it couldn't turn the whole Senate over. They wanted it to be a slower movement in case, you know, there was some crazy idea that became popular. It couldn't take over the whole Senate. There was one body that was elected by the people and that was the House of Representatives. And they were elected every two years. And they entrusted the House with the ability to raise taxes, not the Senate. They wanted the House to vote for taxes because they were accountable to the people, because every two years they had to go run for reelection. And it would be hard if they had just raised everybody's taxes. But the Constitution also was written in a way to dramatically limit the power of the Federal government, because the federal government can only do the specific things that are authorized to it by the Constitution. The states can do whatever they want so long as it's not denied by the Constitution. But the federal government could only do the few things that the Constitution specifically says they can do. And there's very little that the federal government can actually do. You know, 90 plus percent of what the federal government does today is completely unconstitutional. So great. So the Constitution was written to prevent the government from doing all the things that people wanted to do. It wasn't allowed to do it. And then of course, voting was restricted. The states determined who could vote and the states had all kinds of restrictions. You had to be 21 in most states, right? And 21, you know, back in 1792 was a lot different than 21 today. A 21 year old back then probably had been married for four or five years, had a couple of kids and had been out of school since she was 10. Right? So people that were in the real world, so, you know, you were a lot more mature in life at 21. Most 21 year olds today have never had a job and they still live with their parents, right? So, you know, it's very different than a 21 year old back then. But of course they had poll taxes, you had to pay a tax to vote or you had to own property to vote. They had literacy tests, women couldn't vote. You know, not that I would necessarily have that restriction today, but the reason women didn't vote is because they didn't really work. They stayed at home, they took care of the kids. So it was assumed that, you know, they weren't as up on the issues and they wouldn't make as an informed vote as the men. But the whole idea was not that everybody votes. The idea was that we had good government. And if you notice, if you read the Constitution, if you read the Declaration of Independence, the Bill of Rights, there's nothing about voting being a right. You know, we have a right to speech, to own property, we have a right to freedom of religion. There is no right to vote. There's nothing in the Constitution until we got the amendments that said, you know, the right to vote shall not be denied if you're, you're on account of sex, or if you're not 18. But in the original founding documents of the United States, voting was not a right. Voting was a privilege. You know, and the whole idea was to limit voting because the majority is normally wrong. And about everything, if you just decide stuff based on popular opinion, you're pretty much gonna do the wrong thing every time, right? It's rare that the majority is right about anything. And so you don't wanna run a country based on the whims of the majority. And, you know, the founding fathers, you know, called it mobocracy. That's how they define democracy. They didn't like it. You know, they had studied the democracies going back to ancient Greece, where the concept originated, and they were all failures because the people vote themselves broke. And, you know, we're repeating that now. And that's what's going on in New York. You know, the promise of socialism is very seductive, right? Even though it's failed everywhere it's been tried, that doesn't prevent people from thinking that this time it's different, that we have better people, we have more caring people. Yes. It didn't work in Cuba, it didn't work in Venezuela, it didn't work in the Soviet Union. But it's gonna work in New York. We're gonna do it, right? But. And it's very easy to be a demagogue and to say you're poor because this person is exploiting you, right? This rich person is the reason you're poor. And let's just take money away from him, right? If we just take money from this rich person, you can have free healthcare, you can have free transportation, you can have cheaper food, you can have cheaper re. And I'm like, okay, yeah. You know, but they don't understand that none of this stuff is gonna work, that all this stuff is gonna backfire, right? That everything the socialist promises, the opposite is what's gonna get delivered. It's an empty promise. But, you know, it sounds good, you know, but it's not an accident or that that is. That people like it. And the worse you can make the economic conditions, the more susceptible they are to believe this kind of stuff. And look at what happens, you know, look at the rise. And not that I'm, you know, you know, when you bring up the Nazis, but, you know, it's. When you look at how did Adolf Hitler rise to power as on the top of the National Socialist Workers Party, which is what the Nazi Party was. It was a socialist party. It was a workers Socialist party. It was because Germany was a mess economically. They just had hyperinflation from the Weimar Republic, right? They had lost the First World War. They were trapped under the onerous terms of the Treaty of Versailles. So there were a lot of problems. And that was a fertile environment for a guy like Adolf Hitler. To come into power. I mean, if everything was great in Germany, he never could have risen to power. But he was voted into power, democratically elected. He didn't take over by a violent revolution. You know, he was voted in the Nazi party, was voted into power. Right. So that's what can happen, right, when people are voting, and especially when they're voting, when times are tough, you know, and times are gonna get very tough. I mean, they're tough now, they're gonna be a lot tougher soon.

A (41:04)

The problem, though, with taxing the wealthy is it doesn't diminish what they spend, it diminishes what they save and invest. So that's the problem because we need investment capital, we need that. And so to the extent that we're taxing the wealthy, it needs to be a consumption based tax. Not a tax on their wealth or their assets, but a tax on when they buy luxury goods. You could tax that. But the other problem with democracy, right, is you have so many voters that have been bought and paid for. You know, once the government can make you dependent on a government check, right? That's why the government loves to cripple you, so they can give you a crutch that you're now dependent on. And now you vote for whoever promises to continue providing the crutch. And if anybody threatens to take it away, you're gonna vote against them. So you have all these people now that get welfare checks, housing vouchers, Social Security checks, snap benefits from the government. And so they're going to keep voting to keep getting those benefits. And there are all sorts of government subsidies too, where, you know, the people who benefit from government, even if they also suffer, you know, from the same government, but when you get money from the government, you know that you've got it right? So, and the people who are benefiting from government subsidies or programs can organize together to keep those programs. But the taxpayers who pay the bills, they're not in an organized group, you know, they don't necessarily know. Or even if it's not a tax, even if it's a law or a regulation that artificially increases prices so that certain people can get a windfall at the expense of others, the average American doesn't even realize that he's getting screwed or why they're getting screwed. But the people who are benefiting know exactly why they're benefiting and they give money to the politicians who continue to perpetuate those benefits. So the people who benefit from government are organized and they vote and they contribute. But everybody who pays the cost, whether it's through taxes or inflation or whatever, they don't know. They're diffused. And so you end up constantly reelecting the politicians that perpetuate the system that is impoverishing the majority of people who don't know it and who aren't organized. You know, that's why, you know, when you think about voting criteria, I would rather live in a country where I can't vote, but I have confidence in those who can, right? So, you know, whereas if everybody can vote, like, you know, I say, hey, let's wait, raise the voting age to 30, right? And there are going to be some young people who are very competent and probably could cast a well informed, good vote. And let's say I'm one of them. Let's say I'm 21 and I'm going to make an intelligent vote. I would still be in favor of raising the voting age to 30 even though it means that I can't vote. Because it means that all the other idiots who are my age, they can't vote either. Because what good is it if I go to vote and then 10 other people cancel out my vote with their moronic vote? Right? I would rather have responsible people voting so I have good government than a bunch of irresponsible people canceling out my vote. Right? And everybody should feel the same way about it. I mean, it's not about voting, right? It's about having good government. And good government is limited government, small government, government that stays out of the way, right? That allows maximum individual freedom. That's what we want from government. The government that governs best, governs least. And that was, I think it was maybe Thomas Jefferson or Ben Franklin, I forget, but it was one of the founding fathers who said that. And it's one of the most appropriate quotes.

A (50:50)

Yeah, well, look, I think that Trump is overplaying a very weak hand, to use his own analogy. I think China is in a much better position here. You know, China is the creditor nation. China is the producing Nation, we're the debtor nation and the consuming nation. We depend on China, not the other way around. There are billions of people around the world that can buy what the Chinese produce and they can pay for it. And by paying for it, I mean they can export goods to China. See, people don't realize, but exports are a means to an end, right? The reason that you export, if you're a nation, you export to afford to pay for your imports, right? The whole idea behind trade is comparative advantage. So one nation that has a comparative advantage, meaning that they can produce something more cost effectively than maybe another country can produce it. So they produce an excess amount of that and then trade it to acquire the goods that, that the other country produces that it produces more efficiently than they do. So you concentrate on what you do well. You make extra more than you need and then you trade that to acquire the goods that other people make that you need. Right? And then, and so everybody wins from trade, right? Everybody gets to consume more because everybody produces more because they produce what they can produce efficiently. And then they trade. But America, you know, we import or over a trillion dollars a year more than we export. So we're, you know, the world is not getting stuff from us, they're getting paper. But I think what China is going to be doing more is exporting products to countries that produce the stuff that they need, right? So they're not just going to buy Treasuries, they're going to get stuff. And if you look at what's happened, trade with China year over year is up dramatically. Their global trade is going way up, even though their trade with America is going way down because they're trading more with other regions of the world. They're trading more with South America, they're trading a lot more with Africa, they're trading more within Southeast Asia, trading more with Europe. Right? Because China makes stuff that everybody wants. They make great stuff. Why do you think we buy so much Chinese stuff? It's not because it's crap, it's because it's good. We need it, we want it. And there are people all around the world that want that stuff. And so China will just sell it to other people or even better, they'll consume it themselves. What's preventing the Chinese from consuming more? Right now? It's the exchange rate. So if the dollar tanks and the Chinese RMB goes up, let's say you double the value of the rmb, right, relative to the dollar. Now all the goods that China produces for the Chinese, the price is cut in half. Well, gee, a lot of Chinese will now buy stuff. Oh, it's. I can afford it now. You know, the Chinese factories, they don't have to sell the goods to Americans because, well, the Americans are broke now because the dollar has been cut in half. They would have to double prices to get the same amount of money. But Americans aren't gonna have twice as many dollars. Just because the dollar lost half its value doesn't mean we have twice as many. I mean, that's why with these tariffs, you know, Trump was elected promising that the foreigners were gonna eat the tariffs. It was an external tax, right? We're not gonna tax Americans. We're gonna tax the Chinese, we're gonna tax the Mexicans, we're gonna tax the Canadians. That's bogus. We pay the tariffs. The tariffs are on American consumers. They're not on foreign producers. And, you know, now, you know, it's such a hassle, even. I put this on X the other day, but my wife had bought me a couple of pairs of shorts, and I kind of. I liked them. I really liked these shorts. And I said, hey, can you get me a few more in different colors? And she bought them online, but the company is in France. And they said, oh, we're not. We're not shipping anymore to America because of the tariffs. And we just don't even. We're not even shipping to America anymore. And so they just said they don't even want to deal with it, even though the Americans would have to pay it. Just the hassle of having the tariffs, you know, on the, you know, being collected, and the. They just like, screw it, you know, and. And, you know, and people were. Somebody said, well, you know, well, I'll just buy American shorts. Well, no, because the shorts I wanted are not made in America, and I don't need new shorts. I got plenty of pairs of shorts. I just like these particular shorts. And now I can't have them. Now, of course, if I'm on vacation, if I'm in St. Bart over the winter, yeah, I could pick up a couple of pairs there, right? But I can't. I can't order them here because they won't. They won't ship them in. But to the extent that they are sending them, the prices are going up. My friend here, you know, was buying these soccer jerseys, and he had to buy some more, and the price skyrocketed because of the tariffs. They. They. So it's not like they're not just saying, oh, Americans are having to pay tariffs, so we're going to reduce our prices. No, they haven't reduced their prices. Americans just have to pay the price plus the tariff.

A (56:36)

I definitely look at what's going on in Taiwan. I mean, we own Taiwan Semiconductor. I own that stock. I mean, it's like it's a business. And I have investments in Hong Kong. And so obviously that's important there. But the way I think this whole thing is going to end up, I think that at the end of this crisis, China is going to emerge on top. I think that China is going to be the dominant economic and probably military power for the majority of the 21st century. I think that you're going to see a significant decline in the value of the dollar, and that's going to automatically mean that the Chinese economy, their GDP is going to be much higher than the United States. And of course, they have four times our population. There's 300 million or so Americans. There's 1.2 billion Chinese. And for most of human history, China was the dominant economy in the world. So, I mean, it makes sense that they'll be the dominant economy again. But if you look at what's happening there in the demographics and the industry and the savings, they're in much better shape. They do have problems. I'm not saying that it's perfect. In China, they got a lot of problems. And a lot of the problems are the consequence of the dollar's reserve status and a lot of malinvestments that have been made based on perpetuating America and vendor financing the American consumer as their customer. I mean, I think they made a bad bet. They shouldn't have done that. But I think that structurally, fundamentally, the Chinese economy is in better shape than the US Economy overall. Yeah, we have some great companies here. And I'm not saying that there's no positives in America, but taken in totality, we've got some serious, serious problems that I think are even bigger than the problems that they have in China. And I think that's a controversial opinion. A lot of people think that, you know, no, China is a basket case, and we're number one. But I think this dollar crisis and this sovereign debt crisis that come in is going to expose that fiction. And people are going to see. I think we're, you know, we're Great Britain in 1900 and China's America. We're the great power that's in decline and they're the rising power that's going to take our place. Now, I mean, that doesn't mean, all right, we don't have to be the dominant economy. Not everybody can live in the dominant economy. People live in Germany and people live in, you know, in, in the Netherlands or Switzerland or they live in Brazil or they live in Australia and have good lives and they enjoy themselves and they have families. So it's not the end of the world if the Chinese economy is bigger than the US Economy or if China is the dominant economy. I mean, it's not like, you know, the world is over, but that's what's going to happen. There's no doubt in my mind whether the US could ever reclaim that. It's hard to say, but it depends on the road that we go down. I mean, if this crisis produces an even bigger US Government that is even more socialized, socialistic than the one we got now, if we end up with more government, more regulations, more government spending, more programs, more taxes, then we're never going to catch China. On the other hand, if the result is a complete dismantling of our big government and our welfare state and we completely free up the US Economy so that we can recreate the capitalism that we had during the 19th century, if we can create that level of economic freedom and completely minimize the government and actually bring it back within its constitutional limitations and restore the Constitution, then, yeah, I mean, you know, we could easily climb back on top. I don't know how long it'll take, but, you know, it doesn't. You know, the end of the day, what's gonna matter is our individual standard of living and our individual lifestyles, not, you know, you know, which country is richer than the other country.

A (61:22)

Yeah, I mean, if it's a page out of the Chinese playbook, it's the one that we don't want, right? It's the page that we Want to let them keep. You know, it's a socialist concept. I mean, the US Government should not be taking stakes in any companies. The US Government is not a hedge fund. Or they're not supposed to be picking winners and losers and deciding where to allocate capital. That's not what you want government to do. You want the free market to allocate capital because it does a much better job. It does it much more efficiently. Everybody wants to look at, the government's going to invest in a company, okay, where is the money coming from? Because the government doesn't really have any money. It has to redirect money from the private sector. So if the government's going to, you know, subsidize a particular company or a particular industry, it has to suck the capital away from some other industry that otherwise would have gotten that capital in a free market. And so then you have to believe that the judgment of the government is better than the judgment of the free market. Well, where is there a precedent for that? Where have we had a central government authority that's done a good job of allocating resources and capital? There is none. There is no precedent for that. All of the proof shows that it's the capital. It's the free market. Look at East Germany versus West Germany, South Korea versus North Korea, South Vietnam, North Vietnam, Taiwan, Communist China, Hong Kong. I mean, anytime you take the same people, right, everything is exactly the same. And all you do is you change the economic model from free market to government planning. It's the government planning that is a disaster. And it's the free market that succeeds. So everything that Trump is doing in this respect is a mistake, right? And it is a bad precedent. Because if you approve of Donald Trump deciding where to invest money, well, then you better be prepared for AOC to make her investments if she becomes president. Right? Even if you think Donald Trump is this super genius, which he's not. I mean, he's a good marketer, he's a good promoter. He had a lot of failed businesses as a private entrepreneur, right? He had a lot of failures. And so, you know, and it's nobody, no government, nobody is smart enough to know where the capital needs to go all the time. That's why you need a free market. But if you happen to think that Donald Trump is so smart that we want him doing this, well, now you set the president the precedent that whoever is president gets to do this, right? And so do you really want aoc? I mean, what kind of companies is she gonna fund? Right? And again, when you Fund one company, you deny capital to another company that might otherwise have got it, or another industry. I mean, case in point is crypto. The US Government, because of Trump's policies, a lot of money is fueling the crypto industry. That money would have gone someplace else if it wasn't for the favorable policies and the direction that the Trump administration is pushing. Everybody, you know, I mean, one of the reasons is everybody believes the government is behind this strategic bitcoin reserve. Other things. You know, Trump says, I want to make America the bitcoin capital of the world. Why? I mean, if we're gonna let the free market, if that, if that's what it should happen, let it happen. But the government shouldn't decide, here's the industry that we should lead in. No, the free market decides that. What if he picks the wrong thing? What if I'm right and this whole thing is a big bubble, and Donald Trump decides to funnel all this money into this gigantic bubble, and we end up losing all this capital, Right. Squandering all of our resources, you know, because Donald Trump decided this. And one of the reasons that Donald Trump may be doing this is because now his family is all in on crypto. They've started all these crypto businesses. And so I think what Donald Trump is thinking about is what's good for the Trump family. What's good for my kids. Well, they're in this business, so I'm gonna steer money into my family business. Right. That's another reason why you don't want politicians using the political power to advantage their own interests.

A (65:51)

Well, I think they should be able to invest in whatever they want. They just can't use government policy to then manipulate markets to favor what they own. See, if the government just follows the Constitution, we don't have to worry about what they invest in, because they don't have the power to. To rig the game, to tilt the playing field. It's when you give them the power. Now you have to worry about where they put their money. That is the problem. You know, I mean, it's like when you give politicians a bunch of power, you're going to expect people to be bribing them, you know, because they're going to want that power used to their advantage. That's human nature. The way you deal with it is you take the power away from government, you're never going to be able to prevent corruption in government. There's always gonna be corruption in government. So what you have to do is make it so that corruption doesn't pay you, take the power away from government to deliver favors to the people who pay them. Right? And so if there's nothing that you could do for me, then why am I gonna bribe you? Right? But Trump. Trump has put himself in a power where everybody can bribe him. I mean, look, for example, with the tariffs, Trump puts these big tariffs on and then says, okay, I'll give you exemptions, right? So what are you gonna do for me? And if you do something that I like, the tariff won't apply to you. Right? So he's now using tariffs as a weapon. Right? And basically to bludgeon individuals or companies, threaten them with this. Unless you do something that I like and that I won't use this weapon on you. Right? That's why the government shouldn't have the weapon in the first place. They shouldn't be able to extort companies or individuals into doing things, you know, because they're threatening them with this, with this weapon. When you give money to a politician, I have a business, and I give money to a politician, and that politician now goes after my competitor, right? Files a lawsuit against my competitor, does something, right? I'm hiring the government to go beat up my competition, right? That shouldn't be allowed. You can't. You can't let the government have all this power, because the minute they do, you can't blame the individuals for trying to get government power used to their advantage, because if they don't, somebody else will get the power and use it against them. So everybody is vying for the government to be on their side. And the only way to stop that is to take away the ability for the government to take a side. And that's what the Constitution did effectively for a long time. But Donald Trump, like no other president I've seen, is weaponizing the power of government specifically to his own advantage and to the advantage of his friends and family. And I don't like that. You know, I mean, I don't like it at all. Now, Trump's policies, you know, are helping to make me richer than I've ever been, because his policies are driving up the price of gold and silver, and I've got a lot of money in gold and silver, and I got a lot even more money in gold and silver mining stocks. And so, yeah, I know he's enriching me, but I'd rather him be enriching the country with the correct economic policies that I constantly advocate for. In fact, all of the things that I am advocating would result in me making less money. But I don't invest based on what I'm advocating for. I invest based on what I think is going to happen. And so I'm confident that the government's going to do the wrong thing. I'm confident the Fed is going to do the wrong thing. And that's why I have all these gold stocks.

A (70:32)

But I got 1.2 million followers on X, so you can follow me there. I'm constantly putting my thoughts, I do all that myself. I compose all my own posts. So if you read something, it's because I wrote it. And so follow me there. But I think the most important thing that people can do other than telling their friends to listen to me so we can disseminate this information and get the truth out there. Because when we have this economic crisis, the government's going to blame it on capitalism. And I want as many people to know that the government caused a problem and the only solution is capitalism. Not more government, but less government. But people need to protect themselves. They need to protect themselves from the inflation and what it's going to do to the typical American. So you need to get out of bonds, you need to get into gold, you need to get into silver, you need to own real money as your savings, not fiat, and go to, you know, shift gold. And yeah, I mean, if you have money in crypto, you know, you could, you could take some of your crypto as you said and buy some gold or silver as a hedge just in case your crypto collapses too. You might as well have some gold and silver. We make it easy to get out of crypto at shift Gold because we work with BitPay. We were one of the first companies to work with BitPay where you can check out, you can go online, buy some gold or silver, put in a shopping cart and when it comes to checkout you can go the pay with Bitcoin and you know you can use your bitcoin in the same transaction and get, get gold and silver and you know, if you have a larger portfolio where you just don't want to have all your money in physical gold and silver, you want to have stocks, you want to get dividend income. You know I have mutual funds. I have an asset management company that's really my bread and butter is managing investment portfolios for people. We do that at Euro Pacific Asset Management. So the website is europack.com and I would encourage people to have a consultation with one of my representatives. You can just give us a call, toll free number or just sign up to have a consultation. We can talk about how we can help manage your money. You can transfer an account over for us to manage. If you're a do it yourselfer. I've got five mutual funds that you could buy no load at any of the discount brokerage firms. You can get all the information about my mutual funds. You could get a prospectus and all that, see the track records. All that information is on the website@europact.com and in fact if you don't have a brokerage account you can actually buy into the mutual funds directly through the europact.com website. And then I also have a newsletter, a free newsletter that comes out several times a week. You can subscribe to that@shiftsovereign.com we're putting out a lot of excellent content that I would encourage people to read. It's free. We do have some premium services that you could check out. But at least start by getting the free letter and you know shift you just have to enter your email address, some information if sovereign.com and you'll start getting them in your inbox.