Episode 3303: The Currency Wars
Episode Stats
Summary
In this episode of War Room, we're joined by James Rickards, the author of Currency War and author of the new book "Currency war" to discuss his new book, Currency Wars: The New Economics of War, a new kind of currency war, and how he got into the business world.
Transcript
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this is the primal scream of a dying regime pray for our enemies because we're going medieval on
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these people here's not got a free shot all these networks lying about the people the people have
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had a belly full of it i know you don't like hearing that i know you try to do everything
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the world to stop that but you're not going to stop it it's going to happen and where do people
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like that go to share the big line mega media i wish in my soul i wish that any of these people
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had a conscience ask yourself what is my task and what is my purpose if that answer is to save my
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country this country will be saved war room here's your host stephen k band
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it's tuesday 9 january year of our lord 2024 uh we told you about the historic year
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remember tonight uh we're going to be from uh the las vegas uh ces consumer electronics talking
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about the advances in artificial intelligence regenerative robotics all of it and going to
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taiwan we're talking about the really the kickoff to this uh this year of elections where 40 of the
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world's population are going to vote in just about every election from europe to india uh to taiwan
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it's all uh nationalists versus these globalists and the taiwanese kicking off about the ccp is
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probably the most important way we could kick off 2024 of course 48 hours later president trump will be
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the iowa caucasus so we're gonna get to all of that in detail a report from the field with laura loomer
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tonight also um really honored particularly given a historic year a a guy that i have admired and
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has taught me so much over the last uh decade or so jim rickards joins us from strategic intelligence
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jim you know i went to i i as a naval officer in the pentagon i was able to get a graduate degree at
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georgetown in the national kirties studies which was kind of the elite program at the time i think
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started by gene kirkpatrick then i went to harvard business school and worked at goldman sachs had my own
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firm but i never really focused i always kind of missed this thing about currency and really
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understanding currency and i think it was in 2008 i picked up a book currency wars um and uh i think
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it was 2008 and it really changed my perspective on things in fact that really got me engaged in in
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making films uh generation zero and others uh and that was your book and it hit like a block one of
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the things i knew because i still had a lot of relationships in the pentagon uh i did some
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checkings and you had been uh people had reached out to you for war gaming exercises they said hey
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and my theory in the pentagon i was there why are we not focused more on economic warfare why are we
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having these huge defense budget the defense budget at the time or nothing compared to today
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why are we not focused on economic warfare and in the very opening of your book you said hey by the
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way i'm a lawyer i went here i did this i'm a wall street guy but i got wrapped up in doing these war
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games and this is really what the book's about so tell me about that tell us your background because
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i don't think a lot of people know it your background uh your intellectual you know foundations
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and how did that lead you to currency war which has led to everything else yeah it's hard to say
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whether my background is eclectic or i just couldn't decide what i wanted to be when i grew up but i
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yeah i got a graduate degree from your rival georgetown's rival i went to the school of advanced
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international studies uh johns hopkins in washington dc got a master's degree in international
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economics uh you know it's sort of boot camp for the imf tim geithner madeline albright wolf blitzer
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they all you know went to the same school along with quite a few others um then i went to law school i
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used to be proud of the fact that i went to penn law school you know there are eight ivy league colleges
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but only five ivy league law schools because three of them don't have one but uh you know liz mcgill's on
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the faculty she was we know what happened to her she just got fired as president and so uh yeah but
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uh but i stayed on the international side one law degree wasn't enough i got a second law degree um
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graduate law degree from nyu on taxation and i went to work for city banks my first kind of you know
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real job i was international tax counsel for a city bank but you're really you're in the belly of
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the beast if you want to put it that way did that for 10 years loved doing it uh had some great
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dialogues with walter wrist and i tell people that was back when city bank was a bank before they
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turned into a hedge fund but uh was also i mean candidly we sort of thought wall street was like
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getting your hands dirty but the the wrist and ran with city bank is the finance arm of the state
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department so it fit in perfectly with my background in international studies um then i went to the dark
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side i joined a wall street investment bank um we were one of the largest dealers in u.s government
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securities one of the so-called primary dealers and the thing about being a primary dealer
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it's not a well-known category but it means you get to talk to the fed the fed is uh your customer
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uh and there are only about 20 firms on the list you know they're all big banks uh but mine was one
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of them that's really when i really got immersed in federal finance and so forth then i went to work
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for a hedge fund after about 10 years there a hedge fund uh called long-term capital management
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uh we did extremely well and then hit uh uh hit an air pocket and almost closed every i think i think
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i think i think i think i've heard of it it almost took down the america total financial system right
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eventually well actually you're right steve we were within hours of shutting down every market in the
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world now we did film the runways bringing in for soft landing if you think of it in deal terms i know
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you're you're deal maker but this was four billion dollars all cash four days no due diligence that was
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the deal uh that the 14 banks to go in the 14 families but we did it we got it done but with
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hours to spare tokyo was hold on hang on hang on hang on i gotta i gotta talk about this they called
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the new york fed and that's where you're talking about the prime brokers and this will get into you
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know krugman's out to over the weekend with an article doesn't want trump doesn't want rickers
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doesn't want war room you can't touch the fed he said next thing they're going to do they're going to
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start arguing about the fed on long-term capital management didn't they call you guys down to the to
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the to the federal reserve in new york and that's the one that makes things roll that's where the
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trading desk is for these government securities and these prime brokers i think with citicorp
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with citicorp and others oh we don't own they we don't own the fed the federal reserve's trading
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desk the new york fed which is everything is owned by private institutions or banks didn't they call
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guys in there say got them around the table say guys here's how it's going to be pony and this is
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back in the late 90s when four billion dollars a lot of money you're going to pony up four billion
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dollars no due diligence let's go around the table and see what you're going to kick in and we're not
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leaving here till we get four billion dollars uh yes and no but we we actually called them so remember
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we're a hedge fund who in the world we never thought we would be rescued or bailed out or anything of the
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kind we we could see what was happening we had a bad risk management as it turns out very good
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accounting we knew exactly what was happening by the way one of our partners david mullins jr was the
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former vice chairman of the federal reserve of the board of governors so he was a real fed insider but
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we we called the fed and told them what was happening they didn't know um and so they came
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up on a sunday afternoon as peter fisher who ran the open market desk which is what you were describing
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uh gary gensler believe it or not who's now the head of the sec and another guy dean across john
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merriweather who was our chairman and i we sat in a room for five hours with we have you know of course
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computers but we had printouts we just turned the pages and went you know paid position by position
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all around the world and when we were done and peter fisher turned white i mean he's a white guy
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but he had turned whiter uh and he said we knew you guys could destroy the bond market we didn't know
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you could destroy the stock markets we were actually uh the biggest risk garbage charge here we were in
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every deal mci worldcom city uh travelers um lucky boeing uh not that they all went through but
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we anyway so then peter went back to new york and got to get got together with the head of jp morgan
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uh morgan stanley and goldman sachs and said we're going to do something john corzine was involved
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and then they had the meeting at the fed and it's exactly what you described the 14 families sitting
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around the table getting pledges it was it was supposed to be 250 million dollars each um and then it
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would add up to uh to four billion approximately a little bit less um and then but you had you had
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friends like bear stearns that said no we're not in and you know a lot of drama behind the scenes
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uh but then they sent us a term sheet and then just for four days nobody slept from wednesday night to
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sunday night um nobody slept worked around the clock and we got it done but here's what so when you
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lend a good books written about it but but people say well okay what's the big deal they do what they
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don't understand is that if it hadn't got done every market in the world would have closed sequentially
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starting in tokyo london ultimately new york you know they would have reopened at some point but this
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was a major financial catastrophe that was this close to uh to happening um that was good good
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experience i was i was saying in the united states when you screw up badly enough they handed over to
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the lawyers uh so i happened to be the lawyer so i ended up doing the deal what um how did that lead
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to you running currency war around the time of the of the 2008 uh crash and why did the why did the
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military start saying hey this is a new way this could be a new way of warfare actually put you into
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war gaming well i came out of that very dissatisfied with the financial outcome i personally lost money
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but you know billions were lost uh mostly our money by the way it was that's why we weren't lynched
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because it was mostly our money but um the point was i was the lawyer and you know compliance was good
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legal was good we got the deal done etc i wasn't the risk manager but i wasn't intellectually satisfied
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i was like wait a second these guys really were geniuses and good guys i mean know them all they're
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all friends uh marmon scholls and bob merton two of our partners won the nobel prize in economics
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the year before um they had 160 iqs and we we had a bunch of them and so these guys really were the
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best and brightest they really were the smartest they really did win the nobel prize and yet they
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they screwed up badly like unimaginably so they must be missing something of course they didn't do it on
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purpose so i just became intellectually curious i'm like okay what is it about the models that wall
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street uses that could lead to a result like that and i just started plunging into physics applied
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mathematics complexity theory a lot of branches of science and i continue my career but um and and i
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found the answer which is that they assume not to get too technical but there's something called the
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bell curve which is a normal distribution most events are in the middle kind of boring and then
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there are these two tails and these are the extreme events but they're extremely rare you know uh
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jamie diamond jp morgan embarrassed himself a few years ago when they lost money in that
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big whale trade um and he said this kind of thing only happens once every three billion years well
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if you do a normal distribution it is every once every three billion years except it actually happens
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every seven or eight years so that's supposed to tell you when the data doesn't line up with the
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theory it's supposed to tell you the theory is wrong and it was wrong and then then i started
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another quest like well what what's right what is the correct way to do it turns out to be a power
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curve which is a different distribution but these are so anyway with that as background again physics
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and math and a lot of all supply i started you know lecturing and you know it was a regular you know
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a guest lecturer at northwestern university and so forth um and then separately after 9-11
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i was tapped by the cia because there was insider trading ahead of 9-11 um the the 9-11 commission kind
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of covered it up and i know why and i know who did it but um but it was crystal clear i talked to
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i talked to the new york stock exchange specialist in american airlines and united airlines who was
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who were the two airlines that were hijacked and he was he told john maharn passed away a few years ago
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he said jim i've never seen a more blatant case of insider trading in my life um so so the cia
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we're not it was not a law enforcement agency that's the sec and the fbi cia is an intelligence
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agency so what they said was okay if there was insider trading ahead of 9-11 which there was
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if there were another terrorist attack would there be insider trading again could you find it get a
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fisa warrant break down the door and stop the attack and we did a two-year the study on that
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came to the conclusion yes you could do all of those things and then i actually worked with partners
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and we built uh for the agency we built a prototype of a system that would do exactly that so that was
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kind of my immersion in the national security world so when this war game idea came up uh the
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pentagon didn't need any help from me in terms of war games generally but they needed help in terms of
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wall street because they had never done a financial war game before you know this we don't the whole
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idea was there were no missiles or bombs or anything you just you're going to use financial weapons
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currencies stocks bonds commodity you know foreign exchange etc um so i was asked to provide that
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expertise i was on the development team but then i actually got to participate in the game and very
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late in the process um we were recruiting you know the participants on the team you have five teams red
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team blue team all that you know u.s russia china the teams you would expect and uh but i looked at the
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list and it was you know cia fbi treasury department fed think tanks universities what i call the usual
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suspects and i said to the director i said you know um war involves you know lying cheating stealing
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deception and so if you want to have that you need somebody from wall street to to join the group
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so i got permission to recruit a couple real wall streeters i got a senior guy from ubs uh the big
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swiss bank and another guy who had run a city bank moscow uh and got them on the team so we had some
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real world experience um and when i came home after two days uh i said to my wife uh i said i have
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good news and bad news the the good news is my team won uh the bad news is i played china um and that
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that was the they have a scorekeeper and that was the outcome so from that uh so that was in 2008 we did
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at the top secret warfare analysis laboratory at the applied physics lab in washington can you just
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just hang her for one second we'll take a short commercial break sure the legendary jim records
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uh joins us on the other side the uh the founder and the uh driver of strategic intelligence a
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newsletter that i strongly recommend uh if this is your line of country that you guys get involved
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with short commercial break we'll be back in a moment
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as we head toward a presidential election in november one thing you can be sure of 2024
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will be a tumultuous year like no other how will your hard-earned savings fare during this year
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action action action use your host stephen k bannon
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uh we're so um honored to have jim on and uh and to be talking about the strategic intelligence
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newsletter but the reason i want him on today paul krugman uh who won the nobel prize um and and and
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by the way his jim was not for myron shoals was the black shoals i think was the capital asset pricing
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model which really driven modern finance i mean that's one of the basic tools you're taught krugman i
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still don't even know what he won for but he's like a political commentator his piece ladies and
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gentlemen and are we doing our job or what krugman's piece is a is a cry for help because
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the headline is in the new york times donald trump is about to start attacking the federal reserve and
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that's what we want to have jim on today and we'll get to that in a minute so you go up in this war game
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you guys are up at princeton at the advanced studies isn't that the thing einstein in the movie
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oppenheimer isn't that the big scene up there where they're where they're given uh admiral
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schwartz is trying to give oppenheimer to be the head of it and and albert einstein is there
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yeah that well that's the institute for advanced studies in princeton and einstein was there we
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were in a different location we were at the applied physics laboratory uh which is halfway between
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baltimore and washington top secret they do a lot of weapons space exploration but other things
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including is they host they have what they call the warfare analysis laboratory the walrus and
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that's where we we did the war game um uh yes we had this crew and i got a couple wall streeters in
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there so before i went down there i had uh dinner in daring connecticut where i lived at the time with
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um this the one fellow who was who was the russian expert i said i said steve here's what we're going
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to do uh steve halliwell was his name i said you're on the russian team i'm on the china team when we
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take our first break and we go to our embassies and whatever to come up with our plans we should both
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push our team members to go back for those countries to go back to a gold standard the idea
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was russia and china would jointly announce that from now on if you wanted to buy russian energy
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or chinese manufactured goods you can only pay for it in a new currency that they had created they're
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going to set up a bank in london issue a new currency etc but it was 100 backed by gold and if
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you wanted this currency you could either deposit gold in the bank which is fine which they did
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or you could run a trade surplus and get some other currency or uh or borrow it but um but but the
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dollar was done they weren't going to take dollars anywhere and obviously this is not the kind of
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thing happens overnight it's forward leaning but that's the whole idea of a war game is to lean five
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or ten years forward and tell people what's going to happen um and so uh my chinese partners including
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one guy who went on the national security council for obama rejected the idea but the russian team went
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for it uh and then that was funny the the um they have referees and when we first did it uh announced
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it the referee said you can't do that you're you're breaking the rules or whatever and i stood up and
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said wait a second it's a war there aren't no wars you can do whatever you want and they finally
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agreed they said well it's a legal move but it's a dumb move i said well we'll see how it plays out
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and after three days russia had gained points china had gained points just a quick footnote
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uh steve when we did this russia and china each had about 600 metric tons of gold that was their
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reserve position today russia has 3 000 metric tons china admits to 2 000 metric tons actually a little
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closer closer to 3 000 metric tons although there's good reason to believe that they have maybe 5 000
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metric tons or more you know behind the curtain it's something called the state administration of
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foreign exchange either way uh both countries have quadrupled or more five five times 500 percent
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increase in their gold reserves which is exactly what we told the pentagon was going to happen in 2008
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they hosted the worry and they got the results secretary gates said a nice job everybody they
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didn't do anything but hang but hang but hang on six 16 years later or 15 years later you just laid
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out and correct me if i'm wrong because this is your line of country i'm i'm kind of a a devotee but not an
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expert isn't this exactly what the brics nations their central banks led by the chinese communist
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party and the russians are doing in this de-dollarization isn't this this exactly what you warned people about
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we warned them about it in 2008 but i've warned them many times since i gotta say i do get the meetings
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whether it's the you know the treasury or the fed the white house or the pentagon i get in the door i get
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i get to meet with the people i want to meet with they're very polite they listen to me it's it's all good
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but they don't do anything um i was in another war game they have what they call tabletop war games
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which are you know you 10 or 15 people sit around tables less elaborate than what we did
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at the applied physics laboratory um but i was uh you know kind of basically saying what i'm saying
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now that this is going to the de-dollarization and my particular point at that time this is a few years
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later was that we were overusing the sanctions economic sanctions are powerful they can work in certain
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cases not all but some cases but over time you were going to force people to get away from the
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dollars like how many times can you hit a punching bag before the punching bag gets up and walks out
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of the room and that's what the bricks are doing they're walking out of the room that that has
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accelerated but um so anyway i'm in this meeting and i'm one space away one seat away from this guy
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david dollar who was a senior official at the u.s treasury and in charge partly in charge of foreign
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foreign currency in relations with uh with asia and uh so i'm kind of talking along the lines i'm
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talking right now on dollars interesting name just seems dollar but david says um the u.s dollar is the
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global reserve currency it always has been the global reserve currency and it always will be the
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global reserve currency and he slammed you know both hands palm down on the table i said david i feel
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like i'm sitting in whitehall in 1913 listening to john bull say you know sterling is the global reserve
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currency and it always will be the global reserve currency of course that's not true sterling was
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done by in night by 1944 by breton woods so again these things don't happen overnight they happen
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slowly uh it's like a salami type of push but it is happening and and this is where the ukraine war
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comes in but but but but but but but hang on one second before hang on before we go back to the to
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the brits that was before the guns of august before 30 years of catastrophic wars the brits were the top
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of the game they were the the powers of prime reserve currency they had the greatest navy in
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the world the greatest trading remember my dad saying if you saw a map when he was a kid i think
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the pink was britain and it was this little island that controlled so much but 30 years of catastrophic
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wars and mismanagement of their economy and massive deficits led to the end of world war ii it went to
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the the conquering power at that time the united states so these things do happen it's not some
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immutable law of physics that you're just the prime reserve currency am i correct in that
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you're absolutely correct in fact i can tell you the month that the decline of sterling began as a
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global reserve currency it was november 1914 because you're right guns of august the war started you know
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end of july beginning of august 1914 now initially what was happening was that the uk and other european
00:23:27.740
powers but were selling assets in the u.s they were selling stocks selling selling whatever they could
00:23:33.320
to get gold because they you were in a gold standard at the time and they knew they would
00:23:38.160
need the gold to fight the war uh believe it or not john maynard keynes who has got this reputation
00:23:43.660
as a gold basher it's not true he was the guy he was the one voice in the exchequer in the in in the
00:23:50.220
uk at that time saying you must remain on the gold standard and his insight was the following he said
00:23:56.200
you know yeah you know 20 million dead i mean the human sacrifice is beyond imagination be said
00:24:01.880
we're we're not going to win the war with gold we're not going to win the money war with money
00:24:06.260
we're going to win the war with credit your ability to borrow is going to determine your
00:24:11.540
ability to win the war and by staying on the gold standard they had the credit and jack morgan
00:24:16.440
because u.s was neutral at the time we didn't get into 1917 jack morgan raised hundreds of millions
00:24:21.700
of dollars for france in the uk he did not raise one penny for germany not a penny and he could have
00:24:27.200
because again we were neutral and of course the uk won the war but what happened in november was after
00:24:32.920
getting all the gold in from selling assets they needed stuff agriculture clothing weapons uh you
00:24:38.880
know gunpowder they you know resources metals they needed stuff and they had to buy it from the united
00:24:44.680
states so the gold started to go back to the united states to pay for all this stuff and that that
00:24:50.740
flow reversed in november 1914 but it took 30 years it wasn't until uh july 1944 when they signed
00:24:58.240
breton woods that sterling was done and the u.s dollar and the gold standard were the global standard
00:25:03.160
but but that's how it happens it happens over time um you're right it was two wars world war one world
00:25:08.740
war two and a lot else besides and massive debt and overlying on the commonwealth country today
00:25:14.020
and i've said this frequently the world cannot destroy the u.s dollar but we can do it ourselves
00:25:19.700
the united states can destroy the u.s dollar and that's exactly what we're doing and ukraine is a
00:25:25.580
big part of it because of all these sanctions again um i i i teach um i teach financial warfare at the
00:25:31.580
u.s army war college down in carlisle pennsylvania my class on their handpicked mid-career like lieutenant
00:25:37.420
colonels uh navy commanders i had the the top gun once a you know pilot from the uh the navy in my class
00:25:44.300
small group about you know 12 or so and some civilians cia state department etc and uh i so i
00:25:50.400
taught the class in the spring of 2022 right after the war in ukraine started and i said here's what's
00:25:55.960
going to happen the u.s had thrown every sanction you can think of freezing the assets of the russian
00:26:02.060
central bank um banning exports of oil you know on and on and on and i said the russian economy is
00:26:08.820
going to do just fine they're going to any oil that europe doesn't buy they're going to sell to
00:26:12.940
china and india they're going to ramp up they're going to put their economy in war footing ramp up
00:26:17.560
their uh industrial base etc the sanctions will mean almost nothing to them uh and and and that's and
00:26:24.160
i got a lot of skepticism on the pushback because they were all gung-ho you know it was right right
00:26:28.140
after the war started i taught the class again in the spring of 2023 i said here's what i told the
00:26:33.500
class last year and every single thing i said was right it's exactly what's happened the rupel strong
00:26:39.100
the russian economy they have labor shortages i mean their their economy is expanding faster than
00:26:44.080
the u.s economy their economic problems they have labor shortages because they're growing so quickly
00:26:48.520
they've um they don't need to import all these weapons they're building themselves by the way what
00:26:53.580
this war has shown is that nato i don't mean poland forget they couldn't defend uh france at this
00:26:59.460
point i mean these uh kinjal missiles these hypersonic missiles they're blowing up the
00:27:03.420
patriots we they blew it they've blown up four patriot missile batteries a billion dollars each
00:27:07.920
and they've blown up four of them with these hypersonic missiles etc so russia's doing doing
00:27:14.220
just fine um but meanwhile they've expanded the bricks they're moving full speed ahead with the
00:27:21.340
currency and by the way china's a big part of it economically but the big brains are in russia you
00:27:26.000
know sergei lavrov the finance minister uh elvia nabialina the head of the central bank putin himself
00:27:31.740
and putin's two favorite sports are uh martial arts and chess so it kind of tells you that he's a you
00:27:37.820
know a very skilled player but uh hey uh hey jim jim just hey jim can you hang on for a second i want
00:27:44.220
to hold you for another segment because i got more to get into i want to drill down on this that no
00:27:50.320
outside power could destroy the dollar it could only be destroyed by the elites in this country
00:27:55.500
jim rickard's strategic intelligence a newsletter you got to check out we're going to make sure you
00:28:00.560
get full access to it modern day holy world take us out brother jim will be on the other side in a moment
00:28:07.940
you can't handle the truth the truth is the clowns running this joint live for chaos
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go to mypatriotsupply.com today here's your host stephen k bann
00:29:40.820
okay folks and i'm not i'm navigating this up we'll show you the we'll show you the tweet
00:29:47.340
as jim was talking uh john thune this is jake sherman over punch bowl who gets all the scoops john thune
00:29:55.440
the number two in back mcconnell has just told him that uh congress is going to need a cr until at least
00:30:03.200
march to complete the appropriations process these are folks that just got back yesterday
00:30:08.620
after three weeks off they spent all that time off in the fall all the time and you know six weeks
00:30:14.680
in the summer they're sitting here now and hey uh johnson you with the glasses the glass logo which
00:30:21.440
you got to change to the steel balls logo um you promised you promised no more crs that's what
00:30:28.980
did this bifurcated january 19th february 2nd now the bait and switch is happening so jim you said
00:30:35.460
something by the way we're gonna have you back on and this is why i gotta have people uh take a look
00:30:39.180
at the strategic intelligence because this is obviously fascinating it's the reason krugman's
00:30:44.020
worried he understands we're coming for it the fed um the physical we have a unique combination you
00:30:50.400
said hey there's no power on earth by itself that could destroy the dollar that could take us off
00:30:56.960
being the prime reserve currency uh unless we did it to ourselves now there may be a there may be a
00:31:03.520
conversation the american people have over time do we want the commitments to go with it given the
00:31:08.280
benefits although the benefits are quite enormous but this is not what's happened we've had a unique
00:31:13.180
combination of fiscal mismanagement and irresponsibility as seen up here on capitol hill
00:31:19.120
right now coupled with monetary irresponsibility as seen by our central bank the fed and and of course
00:31:27.380
the new york fed also the guys that run it what what are your thoughts i mean how did we have the
00:31:32.820
elites in the country actually working against us and they're crushing the working people in this country
00:31:38.800
how how can we get out of this i mean the bricks nation are basically saying hey maga and the
00:31:44.460
deplorables and the bernie sanders guys the bernie bros all that you may have to suck on this every
00:31:49.520
day but we don't we have a choice i keep telling i said they got plenty of kids that went to harvard
00:31:53.880
plenty of kids that went to sloan plenty of kids that went to chicago and went to went to stanford
00:31:58.940
they got the hp12c they can do the math because the math is not quantum mechanics and they're saying hey
00:32:04.400
we're opting out it's not gonna be easy for us it's not gonna be overnight but we're not we don't
00:32:08.560
have to take it and maybe american citizens have to take it but we don't have to take it jim
00:32:13.520
rickards yeah the the good news steve is that it's not inevitable there are ways out the bad news is
00:32:19.400
that the people in charge and we know who they are it's not some deep dark conspiracy you know it's
00:32:24.160
i'm the secretary of the treasury the chairman of the fed um the head of the imf christine lagarde head
00:32:30.260
of the european central bank i mean and others mark garney that the super central banker we know who
00:32:36.820
they are um but they don't they either don't get it or they're in favor of it i can't come up with
00:32:42.180
another explanation the biggest thing driving the decline of the dollar right now i'm not talking
00:32:46.640
about foreign exchange rates per se i'm just talking about the move away from the dollar
00:32:50.800
as a store of value as a as a reserve asset as a global reserve currency are these economic sanctions
00:32:57.720
and by the way just as a quick aside this may be on the brink of getting much much worse meaning
00:33:04.320
destroying the attractiveness or value of the dollar almost overnight uh because mike johnson that
00:33:10.540
you know the uh the speaker of the house and certainly the senate throwing in all the people
00:33:14.660
you mentioned they're they're working on a plan they're supposed to have answers by the end of
00:33:19.700
february to seize uh the russian assets now the russian assets around numbers about 300 billion
00:33:27.780
dollars russia had in the form of treasury notes and treasury securities in western banks most of
00:33:33.940
it's in europe some of it's in the united states most of it's in europe in custody and in belgium
00:33:38.640
actually um now we froze it on day one so as soon as the war in ukraine started we froze it
00:33:44.160
but when you freeze it it's still it still belongs to russia we didn't steal it we just said you can't
00:33:50.760
get it you can't sell it you can't collect the interest you can't use it but it's still your money but
00:33:54.560
we're just going to freeze it until further notice but what they're talking about now is seizing it
00:33:59.280
which is actually converting it to to our use and you and this is again about 300 billion dollars and
00:34:05.200
using the money to pay for the war in ukraine because it looks like the congress doesn't want
00:34:10.200
to approve the 60 billion dollars we'll see we'll see how that plays out now that is a the reddest red
00:34:16.260
line i can think of you're actually stealing the money by the way it would break a bunch of laws
00:34:20.560
hang on hang on hang on hang on trump because we try to make nato get up to the two percent that
00:34:28.040
they are and be a an ally not a protectorate just like in the middle east we don't want these people
00:34:33.140
as protectorates we're looking for allies around the littoral nation of south china sea but we want
00:34:37.780
allies people step up pay their fair share we're considered the the the uh the the dark the specter
00:34:44.980
of darkness over the post-war international rules-based order that's a combination of
00:34:50.500
treaties and alliances and breton woods in the financial system why is it that trump we're the
00:34:56.140
ones are sitting there saying hey we can't have fisa because we don't want surveillance of american
00:35:00.600
citizens but the progressive democrats and the uniparty republicans want that why are we the ones
00:35:05.740
saying hey we want these nations that are allies to act like allies pitch in have joint operations
00:35:10.800
and help to pay for their own defense why are we the ones saying hey it's bad enough you freeze the
00:35:16.340
russian assets like you didn't even do to the nazis and imperial japan but you can't if you actually
00:35:21.560
take the treasuries convert them to dollars and give them to the ukrainians because in the
00:35:26.320
atlanticists because the american people have said we don't want any more money in ukraine we're
00:35:31.000
we got a two trillion dollar deficit now we can't take another 60 billion and give it to ukraine
00:35:36.280
of just this year because we another 50 and another 50 and another 50 this side we got to nine
00:35:40.700
tree and in iraq and afghanistan why are the why are the purveyors of unity just like this austin
00:35:46.320
situation why is trump the bad guy for wanting stability and they're the good guys when this
00:35:52.820
thing with the russians and i'm not arguing the kgb's position i'm saying if you want to have an
00:35:57.500
immediate breakdown of the international order steal people's assets convert it to dollars and then give
00:36:03.520
it to a country that it's war with them how can this how can they sit there krugman and these guys on
00:36:08.720
msnbc and stavridis and morning joe and sit there and say the trump people are bringing chaos and
00:36:15.320
anarchy when they're sitting there going to the heart of the financial system of stealing the russians
00:36:20.680
keep this money in international banks to to facilitate trade so when they blocked them off
00:36:25.900
they they they seized the asset but just like the the persians we didn't we didn't and the iranians we
00:36:31.560
didn't take it and i steal the money they kept it and that's what they're kind of you know
00:36:35.220
bleeding back to them over time if you take this convert it give it to their enemies their war with
00:36:40.500
them and doing attacks in crimea and in mainland russia this is a trigger to first off a breakdown
00:36:46.800
of the dollar people will run from the dollar will be like argentina but also i think you'll start an
00:36:52.420
international global economic war sir i i think that's exactly right this this goes back to what i
00:36:59.180
said earlier is others can't destroy the dollar but we can do it to ourselves we're the ones proposing
00:37:03.220
this now uh a couple of things first of all they they're talking about late february because it's
00:37:07.380
the second anniversary of the war being whatever that's that but that is the um the timeline we're
00:37:11.780
on right now so uh so a couple things name one country in the world that would want to invest in
00:37:19.140
u.s treasury securities if you witness the u.s stealing 300 billion dollars of u.s treasury securities
00:37:26.400
from the russians yeah saudi arabia china taiwan japan korea all these countries have you know
00:37:35.040
feed those out over time not buy more etc because uh the u.s has shown us willingness to just steal
00:37:45.860
them so again we do it to ourselves it's stupid but beyond that okay the the something about the
00:37:50.800
white house they can barely think one move ahead they definitely cannot think two let alone three
00:37:54.780
moves ahead which a good chess player can do so what do you think russia's going to do if they do
00:37:58.340
this well russia will immediately seize all the assets of western companies in russia now they have
00:38:05.040
you know imposed some counter sanctions and said you can't sell them right away etc but they haven't
00:38:09.380
stolen them and uh and so and most of those assets actually belong to the germans and the french
00:38:15.940
um a little bit the uk but mostly the germans so germans like wait and but a lot of these
00:38:21.540
russian treasury securities are in custody and as i said belgium is the main place but some of them
00:38:26.360
in germany but the point is germany's like well hold on a second yeah i i steal the um the russian
00:38:32.240
treasury securities you the united states use the money to pay for the war and then russia seizes
00:38:37.340
you know industrial and commercial and energy uh assets from you know from uh from moscow to
00:38:44.100
vladysvostok uh and that hurts me so again they haven't really thought through the the the
00:38:48.880
ramifications but the biggest ramifications the one i mentioned which is everybody else's i have
00:38:53.960
no interest in treasury securities because one you'll one day you'll you don't like what i do you
00:38:58.200
don't like uh you know saudi arabia making up to persia or to iran or uh you know china threatening
00:39:04.580
taiwan so you seize my treasury securities there's that's a red line they haven't crossed they're
00:39:09.000
getting ready to cross it and that'll be that'll accelerate the decline of the dollar very rapidly
00:39:13.160
yeah we will cover this and make sure that johnson's guys don't get out of control on this
00:39:18.340
because this will lead to a global economic war uh jim tell us about strategic intelligence i want
00:39:22.880
to make sure the audience gets full access to your thinking your writing everything you've got
00:39:27.240
at that in all your books yeah thank you uh strategic intelligence is our flagship uh newsletter we have
00:39:34.640
a couple other publications they're a little more specialized but comes out once a month um a uh
00:39:40.200
subscription for years you know you get 12 issues very model modestly priced we put more time and
00:39:46.300
effort into that than anything else we do it's i write about 5 000 words which is you know chapter
00:39:51.960
length we have several other contributors are really good ones uh byron king and others uh dan
00:39:57.260
amos who contribute to it as well uh we cover you know mostly economics and markets that's our job but
00:40:03.060
um it used to be economics was one subject and politics was another that's not true anymore they're
00:40:08.280
completely tied up and we've been talking about it today how you know the politicians in congress are
00:40:13.940
destroying the economy and destroying the dollar so we we turn to politics as well uh because we have
00:40:20.160
to because you you can't understand the economic situation without the politics so i love writing
00:40:25.600
it i put a lot of a lot of effort into it i get a lot of good feedback from uh from uh subscribers i was
00:40:32.220
in uh i was with my uh son-in-law the other day we were changing a tire in a workshop in a garage and
00:40:37.940
some guy came up out of nowhere and shook my hand he said hey i'm a subscriber i love it so
00:40:42.000
uh so we really uh really really um enjoy doing that no no i want hang on hang on i want to go to
00:40:48.420
that i want to go to that point because one of the things we pride ourselves in war room is to tell
00:40:52.620
people the way the system works that you can't understand politics and you can't understand
00:40:56.020
what's happening in this country until you understand capital markets and economics and we've
00:41:00.140
been giving a course on that for the last couple years for the audience because a lot of audience
00:41:03.960
members saying hey this may be too uh too above me talk about the guy that came up and shook your
00:41:08.940
hand well for the audience i mean do you need any prior education to to to actually begin to understand
00:41:15.140
the strategic intelligence main newsletter do i have to have a master's degree i mean the target
00:41:19.980
audience i understand a lot of guys on wall street follow you a lot of investors follow you
00:41:23.800
but for a general audience here a mega audience who's who's what's the wheelhouse who's in the strike
00:41:29.320
song for you yeah steve i i pride myself and it's my job on basically taking the most complicated
00:41:35.000
concepts you can think of and putting them in plain english and i just to be clear i do not
00:41:39.540
dumb it down i've never dumped anything down but i do write in plain english and that by the way that's
00:41:44.420
a skill in and of itself because economists love you know they love jargon and nominal nominal wage
00:41:49.500
rigidity well it just means people don't like to take a pay cut so why don't you just say people
00:41:53.300
don't like to take a pay cut why do you have to use a phrase like nominal wage rigidity and i don't
00:41:57.540
so we write in plain english by the way there are very few really advanced economic concepts that
00:42:03.040
are actually that difficult to grasp but they would it's like a priesthood they would like to
00:42:08.040
pretend that it is and they use the jargon to kind of put up a front but the truth is it's not that
00:42:13.780
complicated you know you start with supply and demand and you know get a few factors and go from
00:42:18.380
there so the answer is no you don't need um uh you know you don't need a college degree you don't need
00:42:24.000
a graduate degree uh you don't need to understand all the jargon or if i use it i explain it i'll use
00:42:28.740
a technical term and then i'll explain it in plain english so it's very accessible but i uh you know
00:42:34.240
you get uh you know airports hotel lobbies uh you know whatever people come up and and shake your hand
00:42:40.020
and i i love it i always spend time with uh with anyone who expresses an interest but uh yeah the
00:42:46.420
audience is diverse and it's um uh and the thing that i really you know we sort of have a
00:42:52.600
kind of 50 and older demographic but a lot of younger people a lot of people in their 20s are
00:42:57.220
subscribers and you know write to me and talk to me as well because they've been um they're they're
00:43:02.900
smart they're not uneducated but they're miseducated they've been taught a lot of stuff that just
00:43:07.660
basically isn't true um we're now in the third generation of americans who have no understanding of
00:43:14.080
the gold standard i run into people they're smart people and they go oh gee i never knew we were on
00:43:18.680
a gold standard and it wasn't that long ago 1971 early 70s hey jim jim jim hang on for one second
00:43:26.680
take another break jim rickard is going to join us on the other side
00:43:29.480
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jim i want to thank you for coming on today we look forward to having you back on on a regular basis
00:44:55.560
because these are the issues this look we're fighting right now people are manning the ramparts
00:45:00.560
on this obscenity that speaker johnson has put forward we're not going to let that happen
00:45:06.100
this fiscal mismanagement and this fiscal irresponsibility responsibility stops with this
00:45:12.200
audience uh we're going to be turfing people out of here because it's just outrageous what he's going
00:45:16.520
along with but i want to make sure people get access to the newsletter so where do they go again
00:45:20.700
yeah i'll publish it paradigm press p-a-r-a-d-i-g and paradigm press strategic intelligence put that in
00:45:28.700
any uh you know search engine google whatever our landing page will come up and you'll see all the
00:45:33.880
publications and you know check them out and uh the one that works for you you're uh we're we're
00:45:39.780
we love new subscribers and we welcome uh welcome those folks on board by the way honor to have you
00:45:47.220
on here thanks for spending so much time uh grace and mo let's get it out to all the chat rooms how
00:45:51.100
people get access to jim uh brother thank you for running uh currency wars it was a game changer for me
00:45:57.020
and thank you so much for coming on the show appreciate it thanks
00:46:00.160
krugman uh is a smart savvy guy a very smart savvy guy and he um he understands exactly where this is
00:46:11.380
headed the central bank of this country the federal reserve is one of the biggest problems we have in
00:46:17.660
this nation it's impoverishing you every day and we're gonna get to the bottom of all of it and yes
00:46:23.260
we're full-on and an outright assault on the federal reserve this is one of andrew jackson's
00:46:29.200
central uh themes on his populist movement uh his populist movement which is um was about the central
00:46:36.140
banks of bank of the united states at the time and this populist movement obviously what 150 years
00:46:41.840
later 175 years later 180 years later has many of the same elements to it we don't want central control
00:46:49.200
of the banking system we don't want central control of our currency that's not controlled by the american
00:46:54.720
people and we don't control it we don't control the fed the prime brokers own the federal reserve not
00:47:00.400
the american people so anytime they give you the spin like that it's just not the case and what they do
00:47:05.480
is they work to enrich themselves this is why you've had the greatest concentration of wealth in the
00:47:09.880
history of this nation from the 2008 uh the collapse brought brought on by those guys that they then
00:47:16.680
bailed themselves out people looked the other way in congress bailed themselves out or didn't
00:47:20.760
understand it and remember our task and purpose here is to make sure you understand it because once
00:47:25.300
working class and middle class people understand how the con works how the scam works that's the
00:47:30.900
beginning of the end of the con this is why they never talk about this all these other shows have
00:47:34.880
so many shiny toys and more fun things to talk about i understand the war room is work i got that but
00:47:40.620
it's work for a purpose to empower you to make sure that you can use your agency they've never had
00:47:46.660
fights on capital hell over these budgets like they have because of this audience because you guys are
00:47:50.200
up to and they can't spin you anymore with talking points johnson's talking points the other day were a
00:47:54.900
disgrace he treats you like a bunch of simpletons and johnson and the staff around him you got a man up
00:48:01.620
bro i'm telling you we will count your speakership in weeks not in months in weeks not in months
00:48:09.740
michael and dell you've seen we're gonna have a report from loomer this afternoon on what's happening
00:48:15.460
on the ground in in iowa you've seen it of course bitter weather is hitting there a lot of people now
00:48:20.680
saying oh nicky and nicky's got the biggest donors all these globalist donors democrats reed hoffman
00:48:25.680
all these evil guys she's going to make a run in new hampshire it's all this that's why this audience
00:48:30.160
has got to be prepared to show up you got to vote you got to have the president's back president
00:48:34.540
trump's doing everything he can he's in court today they're trying to destroy him finally willis has
00:48:38.380
got her alleged boyfriend on the payroll it's just the thing's insane it's lawfare on january 6th
00:48:43.900
that's what they're running on we're going to run on peace and prosperity that only donald trump
00:48:48.100
delivered and only donald trump will deliver uh give me your assessment of where we stand on all
00:48:53.260
this particularly the election being stolen because that's what they're working on how to steal it
00:48:57.360
uh and then give me an update on the company well would you would you rather have the uh the donor
00:49:02.860
money or would you rather have the people's votes our great real president has all the votes and uh
00:49:08.240
people are they're excited they're going to get out like they've never gotten out before and and uh
00:49:15.360
you know i've been down there twice now and over the last week and and it's uh everywhere you go you
00:49:22.180
don't even have a talk of anyone else other than uh our great real president donald trump and uh you
00:49:27.660
can see that all over social media too um it's uh um i'm excited i think you know this is uh i'm glad
00:49:35.200
they're there you know look at our real president putting in all the time down there knowing that
00:49:40.040
it's you know you go through you you breeze through i went with i'm in a landslide and then it's just
00:49:45.820
that's gonna set just set a precedent and the rest of them should just drop out and uh let's uh
00:49:52.160
let's save it for the big general election and get everybody everybody united as a people um
00:49:58.060
you know hang on hold it hold it hold it right there but that's the whole thing that upsets me
00:50:02.940
so much about the rnc about these phony debates about what fox news is doing because all day long
00:50:07.900
it's somebody it's either glenn youngkin or nicky haley or ron de santis they pick anybody but trump
00:50:12.440
that's we need to be focused on the general and we need to be focused on winning the house the senate
00:50:17.700
the president's seeing a landslide these governorships it is obscene the amendment they're
00:50:22.600
going to spend up to a billion dollars on trying to take trump out in these bogus primaries brother
00:50:26.920
it's a big distraction you know we had the the great interview last night with lou dobbs and the
00:50:32.700
and our real president and we were attacked like you've never seen they just don't they don't want
00:50:38.080
anything um they're doing everything they can to stop our great president donald trump and
00:50:44.440
and uh it's uh the resources spent it is it's a big distraction and just like these uh indictments
00:50:52.540
and all this uh on all this um uh court stuff and but you know what it's actually you look back and
00:50:59.000
they what traditionally would have hurt it actually helps everything going on it helps but it's just
00:51:04.320
disgusting you got the rnc and like you say fox news and everybody there when are they going to come
00:51:09.960
on at the last minute oh yeah now we all support and you know people aren't good people are going
00:51:14.140
to remember and they're going to remember that uh um they're not going to forget um especially when
00:51:19.960
you get your fox news out there um they should uh you know it's a shame steve they haven't showed up
00:51:25.840
at rallies for him for years um no it's under they don't they don't want it the murdochs don't want
00:51:31.460
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war room special is there charlie kirk is next but so big after that we're back five to seven
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