00:00:00.000Today, the Charlie Kirk Show, Ed Dowd joins us to talk about the collapse of Silicon Valley Bank and, as he calls it, the collapse of the American economy.
00:00:52.000We will not embrace the ideas that have destroyed countries, destroyed lives, and we are going to fight for freedom on campuses across the country.
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00:01:12.000The chancellor of UC Davis has released this hostage video that he was obviously forced to make by the people around him.
00:01:19.000He's got to be really careful with what he was saying here.
00:01:21.000He's got to be really careful because the president basically says that I abhor his speech and nothing would be more powerful than him speaking to an empty room.
00:01:42.000One day someone's going to be held accountable legally for this.
00:01:45.000I want to talk here just for a second about how you guys can get your tickets to our upcoming campus tour, tpusa.com, and get your tickets there.
00:01:57.000I had a great opportunity to go to the border with someone that really impressed me, someone that should be a senator for the great state of Pennsylvania.
00:02:04.000And maybe he'll do something in the future that is exciting because he definitely needs to be in leadership.
00:02:09.000But he's the author of a great new book, Superpower in Peril, A Battle Plan to Renew America.
00:02:15.000And it's David McCormick who joins us now.
00:03:05.000I think we're only going to win as Republicans and conservatives if we have great candidates, but we have great ideas.
00:03:11.000And this is my attempt to try to help that debate.
00:03:14.000Well, let's talk about the China issue.
00:03:15.000There's so many different issues there, not from the Confucius Institutes to the Belt and Road Initiative to the cyber issue to the economic issue.
00:03:26.000But kind of from your perspective, you ran one of the most successful firms in America for quite some time.
00:03:32.000It was amazing what you were able to do there.
00:03:34.000And so you understand economics really well and the financial implications.
00:03:38.000And so if you were to say the Chinese Communist Party is a direct threat to America because why, Dave?
00:03:46.000China is a direct, and the Chinese Communist Party is a direct threat because their techno-authoritarian model is gaining ground on America for global primacy.
00:03:59.000There was a great report, a great article in the Wall Street Journal a couple weeks ago, Charlie, which was from a think tank in Australia that analyzed the 44 most critical technologies for economics and national security, satellites, robotics, artificial intelligence, and so forth.
00:04:16.000The Chinese are in the lead in 37, according to that analysis.
00:04:36.000And so this book, among other things, lays out a plan for how we can recover our leadership.
00:04:41.000And that leadership, you know, their model, if you had to bet on our model or their model over the next 20 years, you'd bet on our model.
00:04:48.000But what's happened recently is because we weren't paying attention, they have become a dominant technological force and a real threat to America's role in the world.
00:04:57.000And that's what this book is about is laying out a plan for building muscle, going to the gym at home to build our own capabilities, but confronting China abroad.
00:05:06.000And I have a chapter on how I do that too, which I'm happy to talk about.
00:05:09.000But we need to have a whole of nation strategy for taking on China.
00:05:15.000We need a whole nation strategy for bringing China to heel.
00:05:18.000So a provocative idea that some people have floated out that I sympathize with on moral terms, but I also understand that it's rather aggressive is, is it time to decouple?
00:05:26.000I mean, there are some really thoughtful people that are talking about that economically.
00:05:32.000That would definitely mean that there would be rising costs and probably economic uncertainty.
00:05:37.000But is that something we should be entertaining or at the very least, you know, identify 10 or 20, 30 different sectors where you say we want to make this?
00:05:52.000And I know I should follow and know such things, but that our pharmaceutical supply chains during COVID were so dependent on China.
00:06:01.000I was, you know, I knew we were highly dependent on microchips, but 90% of the microchips that we require are manufactured 90 miles from mainland China in Taiwan.
00:06:11.000So it is an absolute travesty that we have an entire semiconductor industry, which is critical to every aspect of national security and economic well-being that's offshore.
00:06:24.000So that's a perfect example where we need to decouple.
00:06:26.000There are a number of areas where we need to bring those capabilities home or have them within our closest allies where we can be dependent on it.
00:06:34.000And that's going to have implications for our ability to have manufacturing jobs here at home in very positive ways.
00:06:41.000It may raise costs, but it'll create actual security.
00:06:44.000Whether we should take the final step and make sure that t-shirts and sneakers and things like that can be manufactured in China.
00:07:02.000Technology farms, the things that when you wake up in the middle of the night and said, would we want our biggest adversary who may have or does have very negative intentions in terms of our role in the world vis-a-vis them, would we want them to have control?
00:07:16.000And if the answer is no, we need to bring it home.
00:07:18.000And so there's a number of thoughtful people making this case.
00:07:31.000And as you said, I ran an investment firm for a number of years.
00:07:35.000Today in China, today in America, rather, there are investors, venture capitalists in California, that invest in artificial intelligence companies in China that do business with the PLA.
00:07:48.000We need to have an outbound investment review process that makes sure that we're not doing anything that's going to enable our adversary to be able to challenge us on the global stage.
00:07:58.000And so that would be a second piece of a whole of nation strategy.
00:08:01.000The third is to hold China accountable for the Wuhan lab, for human rights abuses.
00:08:09.000The fentanyl crisis in Pennsylvania, Charlie, we talked about this on our border trip.
00:08:13.0005,000 deaths last year in Pennsylvania.
00:08:16.000So we've got to hold a hard line on these issues with China.
00:08:19.000And then finally, and we need to do more of this, but we have some very critical allies, Japan, Australia, some of the five Eye intelligence companies, countries, New Zealand, the UK, where we should really combine our strategies around technology and trade and national security even more fully than we do.
00:08:39.000We don't have to bear all the cost of this.
00:08:41.000We need to have our most trusted allies in line with this.
00:08:43.000President Trump did some good work along those lines, and we need to continue to build on it.
00:08:47.000One of my concerns, though, to get this done, again, the book is Superpower in Peril, some amazing ideas in it, is the elite capture that China has been able to successfully embark on, right?
00:08:58.000The fact you're saying this, Dave, would make you kind of, you know, persona non grata in certain circles, right?
00:09:04.000If you work for the NBA and you were talking like this, you're not allowed to say that because their growth market is mainland China.
00:09:14.000Well, I think elite capture is a problem relative to China, but it's a problem more broadly across an entire progressive agenda that I fear is taking our country in a really terrible direction.
00:09:27.000But I think on China, we need to highlight the issue.
00:09:30.000I think we need to talk substantively about the implications of being dependent on China the way we are.
00:10:27.00031 whole fruits and veggies in a capsule.
00:10:29.000I know a lot of people who take supplements and formulated nutrition packs, but balance in nature goes right to the source.
00:10:35.000Real fruits and veggies, all that nutrition captured with their advanced vacuum-cold process, packed in a capsule and sent to your doorstep.
00:10:41.000I give my body what it needs because feeling great is important to me.
00:10:45.000Getting good daily nutrition is the foundation of all aspects of good health.
00:10:49.000And that is why you hear me talking about balance of nature on my show.
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00:11:02.000You can order by phone by calling 800-2468-751 or go to balanceofnature.com.
00:11:18.000So David, as we talk about this rallying cry against China, it has to be an above all approach.
00:11:25.000And what I like about what you've done in the book is you talk about it in military terms, battle plan, right, with your experience being in the military.
00:11:33.000And I want to focus on the specifics of one of the things you mentioned, which is holding China accountable, because that's a question about justice, right?
00:11:40.000Justice for fentanyl, justice for hacking our cyber grid, justice for spying on us, justice for having a spy balloon over our sky, you know, justice for whatever happened in the Wuhan Institute of Virology, which could have been attributed to sloppiness, but definitely there was a cover-up, right, in the days and the weeks that followed.
00:11:59.000What does justice look like then, David, to hold them accountable and make them pay an appropriate price?
00:12:04.000Well, I think it starts with calling balls of strikes.
00:12:07.000And, you know, the Biden administration hasn't done that, for example, on the Wuhan Lab.
00:12:12.000And that's a real problem because if you're not constantly bringing forward the things that are unacceptable behavior and taking steps to mitigate them or taking steps to hold accountable through sanctions or a variety of other things, then that behavior gets validated.
00:12:26.000And the belief is that that's okay to do again.
00:12:29.000And so this spy balloon is another example.
00:12:33.000That should have been handled much more decisively with a clear line established that, hey, this is unacceptable over U.S. airspace.
00:12:40.000And all of these things are part of a leadership under Joe Biden that's very hamhanded.
00:13:01.000And the problem with being hamhanded and bungling things in a leadership perspective, if you're up against an aggressive opponent, it's much easier to have a miscalculation.
00:14:14.000If you think about U.S. and Chinese interest, there was a hope.
00:14:21.000There was a hope 20 years ago that I think a misguided hope, but there was a hope that the way that relationship would evolve is that there would be economic relations and those would benefit both countries and that the more exposure China got to the United States, the more there'd be a move towards liberty and democracy and human rights.
00:15:30.000has sent China on a course that's far more aggressive, far more ambitious, far more expansionist, and far more threatening to America's role in the world.
00:15:38.000And he's establishing that vision, which will, I suspect, live on after he's gone, but he won't be gone for quite some time.
00:15:46.000And that's the vision we're going to have to deal with.
00:15:47.000Superpower in peril, a battle plan to renew America.
00:15:50.000David, thank you so much for joining us.
00:15:52.000I encourage everyone to check out the book.
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00:17:06.000Joining us now is Ed Dowd, author of Cause Unknown, an author and founder of Finance Technologies portfolio manager at BlackRock for 10 years, managing $14 billion equity growth fund.
00:17:17.000I do want to talk to you, Ed, today about the vaccine issue.
00:17:20.000I think it's really interesting, but I want to start with Silicon Valley Bank and the bank run that almost happened, didn't happen, Signature Bank.
00:17:32.000And what do you think is the most obvious truth the media is missing?
00:17:36.000So this was going to happen regardless.
00:17:40.000At the end of November of last year, M2 money supply did year-over-year negative growth.
00:17:48.000Okay, so the last time that happened was 1930.
00:17:51.000And so this is the fifth time since 1868 that's occurred.
00:17:55.000And the other four times it happened is associated with financial panics.
00:17:59.000About a month and a half ago, I put out a tweet talking about we were seeing a setup in the capital markets, different asset classes lining up to auger poor things for financial assets.
00:18:11.000And this SVB just happens to be the headline.
00:18:14.000And we're going to see what I think is rolling thunder, rolling financial crises throughout the next year or two.
00:18:23.000I think it's going to be a controlled implosion on the way down because the Fed and the government are going to come in and do this whack-a-mole thing.
00:18:29.000And every time something rigs its ugly head, they're going to respond.
00:18:32.000The markets will think everything's okay.
00:18:34.000But I think this is the beginning of the end of the global financial system, as we know.
00:18:40.000And something new is coming in the next two to three years, I suspect.
00:18:48.000I think the plan from our vettors is the central bank digital currency.
00:18:54.000And I was talking to some hedge fund managers over the weekend, and they're looking at the regional banks.
00:18:58.000They're looking at the mismatch of interest rate risk that a lot of them have.
00:19:03.000And a lot of these guys are probably going to get into trouble and eventually will be consolidated into the six systemically important banks, the big banks.
00:19:12.000That's probably the plan going forward.
00:19:16.000I don't think it was the plan in a room cackling monetically.
00:19:20.000I think it's just what's going to end up happening.
00:19:22.000So regional banks, I think, are in trouble.
00:19:24.000And it's not going to happen overnight.
00:19:26.000Just going to kind of happen over time as the economy continues to slide into a deep, deep recession, which is, I've been saying, for the better part of, you know, six months to nine months.
00:19:37.000So, a CBDC, how would that technically be different than what we already have?
00:19:52.000Yeah, I'm not in the room, so I don't know.
00:19:55.000But the idea behind a central bank digital currency is it allows the regimes of the globe to have more control over your decision making.
00:20:06.000So it's, you know, the Bank of International Settlements, a year and a half ago, one of the senior guys there made a famous speech saying that once we introduce the CBDC, we'll be able to have more control over what money is and where we can direct it according to what we think.
00:20:22.000And, you know, that just sounds like total control to me.
00:20:26.000And I suppose the argument they're going to make is that paper money has already kind of been phased out.
00:20:32.000And so everything we do is digital as it is.
00:20:35.000But, you know, in some ways, you're seeing this implosion of crypto.
00:20:39.000You have to wonder if it's an intentional implosion of crypto because crypto is in some ways a threat to that because by definition, it's decentralized.
00:20:47.000And so, so, Ed, what you're saying is that we're going to see these, you know, kind of a little bit of a crisis here and a crisis there.
00:20:56.000And they're going to bring us towards what could be, you know, the aforementioned great reset or, you know, the currency collapse.
00:21:11.000We're going into a deep recession, maybe a depression, don't know.
00:21:15.000But when N2 does what it just did, it's a rare event.
00:21:19.000And it's because, you know, the US dollar, which is the Federal Reserve currency of the world, is in all the corners.
00:21:26.000And, you know, the system needs constant credit creation.
00:21:29.000And after COVID, it was going to collapse in 2019.
00:21:32.000There was a crisis looming, but then COVID gave central bankers and politicians an excuse to print unprecedented amounts of money to plug the hole.
00:21:42.000That gave us another two years, but the math is the map.
00:22:44.000So I think as a nation, we just, everyone should start, you know, just when you go to Costco, whenever you go to a restaurant, use cold hard cash.
00:22:53.000Oh, you mean the stuff that's actually in your wallet, not just debit credit?
00:23:05.000There are so many incentives to try to get your cash into the system, get your cash into the system to go cashless, go cashless, go cashless.
00:23:14.000The entire police state of the IRS is basically set up to try to go up against cash businesses, right?
00:23:21.000And for quite some time, they've been incentivized in that way.
00:23:24.000But let's go back to our just kind of some fundamental vocabulary here, because some people are asking in the chat and emails, what is M2?
00:23:32.000And explain just kind of more in layman terms, the significance of what happened that only hadn't happened since 1930s.
00:23:39.000Just if you could just re-explain that for our audience, I think that would be really helpful.
00:24:03.000So the credit system needs constant flow, constant credit creation.
00:24:07.000And when that stops, we have what's called a liquidity crisis.
00:24:11.000And that's what happened to Silicon Valley Bank.
00:24:14.000Let me really tell people what happened there.
00:24:16.000So during the free money times, they were constantly, the VCs are their biggest clients, and their VCs were constantly raising venture capital funds, then giving them to companies in their portfolio.
00:24:30.000Then those companies had to bank at Silicon Valley Bank because they got great terms.
00:24:35.000But one of the terms was you had to keep all your deposits on hand at Silicon Valley Bank.
00:24:40.000And their deposits were growing quite nicely.
00:24:43.000But then last year with the turmoil we saw in tech land and the beginning of the economic turmoil recession that's looming, liquidity dried up and interest rate increases dried up liquidity for all these VCs.
00:24:56.000So there were no more C rounds, B rounds to fund these.
00:24:59.000So basically the deposits in Silicon Valley Bank stopped growing and actually started to slowly decline as the companies that were already in the portfolios started drawing down for operations.
00:25:10.000But there was no new companies being funded, no new rounds of financing.
00:25:14.000So their deposits just started to dwindle, but they had all these assets on their balance sheet.
00:25:18.000So that's the liquidity problem right there.
00:25:21.000And that's why Silicon Valley Bank happened to be the first accident.
00:25:24.000There'll be more, but that was one of the first ones.
00:25:29.000And then signature also, do you think the federal government did the right thing to fully guarantee the depositors above the $250,000 mark?
00:25:40.000Well, we can get into debates on that.
00:25:42.000And if they didn't, this unfolding crisis would have happened a lot faster.
00:26:49.000With more debt and more money printing.
00:26:51.000We could have let the system reset and let capitalism do what it does.
00:26:55.000We would have had a very short deflationary, maybe minor depression, but we would have rebounded out after all those institutions were wiped off the face of the earth.
00:27:04.000But what we ended up doing was trapping capital in bad assets.
00:27:07.000We've had a zombie economy for 12 years, and only the rich get richer.
00:27:10.000Those closer to the printing press get immensely wealthy.
00:27:14.000You know, this system needs to change.
00:27:17.000I don't know what it's going to look like, but the system is inherently flawed.
00:27:45.000And it does present an opportunity, though, the crisis where because of blockchain and Bitcoin and cryptocurrency, I mean, we could theorize that there might be a couple trusted sources out there that emerge that actually have a stable ability to go back to, you know, a replacement for barter.
00:28:04.000Again, I'm just thinking out loud here.
00:28:06.000I think they have to get rid of cryptocurrency.
00:28:09.000And so without going too far into the future, though, I mean, the whack-a-mole analogy is really powerful because the federal government's just going to try to calm down the contagion of a panic.
00:28:19.000In some ways, they're almost playing societal psychologist, right?
00:28:22.000They're almost just everything's just fine.
00:28:25.000Just take your meds, everything's fine.
00:28:27.000When in reality, you know that the whole thing's about to collapse.
00:28:31.000So play this out, 45 seconds remaining, Ed.
00:28:34.000I mean, what other sectors do you think are going to be hit next?
00:28:36.000If banks go, then you have to probably speculate that the people that are getting the loans from the banks are probably going to go next.
00:28:44.000Yeah, any business that's not cash flow positive will go belly up.
00:28:48.000All the speculative, all these speculative companies that are burning cash, they go bye-bye.
00:28:55.000The other thing about this whack-a-mole scenario is that what they can't control is an international problem.
00:29:01.000And I think there's going to be, there's a sovereign debt crisis coming somewhere from one of these countries out there.
00:29:06.000And when that goes, that's when the contagion really will become unstoppable.
00:29:10.000Right now, this is a localized, very regional bank.
00:29:13.000They're able to stop the bleeding for now.
00:29:16.000But this is going to be, this is going to unfold over the next two years.
00:29:19.000And anybody that doesn't have cash flow is in trouble.
00:29:23.000On that uplifting, an optimistic note, we are going to be back with Ed Dowd in a second.
00:29:27.000And Ed, I want to compliment you on your powerful work on the vaccine issue.
00:29:31.000Your comments, this is one of the best dialogues we've had for quite some time.
00:29:38.000So, Ed, I was speaking to a group of brainwashed college students at the University of California, Santa Barbara, and I wasn't getting anywhere.
00:29:45.000And I could use your advice and you could explain to the whole audience.
00:29:48.000What is the most compelling piece of evidence that you have discovered and that you have covered to show that the vaccine is indeed harming people?
00:29:57.000What is the one or two pieces of data that you think is the most persuasive?
00:30:02.000This is what we call the elevator pitch.
00:30:04.000So two data sets, Society of Actuaries, which are group life policies at the elite, elite corporations across the U.S., Fortune 500 mid-sized.
00:30:14.000Their excess mortality in 2021 was 40%.
00:31:13.000Of those 3.2 million people that were added, 1.7 million are employed.
00:31:18.000When you look at the disability rate increases, employed went up 31%.
00:31:22.000The general U.S. population went up 9%.
00:31:25.000And what's even worse is those not in labor force, those are people who could work and are willing to work.
00:31:30.000Their disability rate only went up 4%.
00:31:33.000Those are the people who got fired for not taking the job or refused to take the job and quit.
00:31:38.000So typically speaking, the employed of the country, by the very nature of going to work, aren't as disabled as the general U.S. population.
00:31:46.000And this has never happened in the history of our country.
00:31:49.000Those two pieces of data are, for me, a mic drop.
00:31:53.000That's what I presented to Senator Ron Johnson in December.
00:32:07.000My response would be, well, so did the virus mutate in 21 and 22 to only affect younger aged working people, but somehow avoids those who are not employed.
00:33:22.000And I can tell by my social media following.
00:33:27.000Again, if you take Ed data out of the equation, there's interest in this topic.
00:33:31.000And my Twitter followers are now increasing, you know, 1,000 a day as opposed to 100 a day.
00:33:37.000So there seems to be an awareness and an understanding that something has gone seriously off the rails and it's spreading like wildfire, word of mouth.
00:33:46.000I've been able to get on Patrick Beth David's podcast and Tucker Carlson and shows like yours, but it's still a struggle to get the book message out.
00:33:57.000One thing that's interesting about my book is it's not really been criticized or reviewed because it's bulletproof.
00:34:05.000And they did the same thing to Bobby Kennedy's book about Anthony Fauci.
00:34:11.000If it's well sourced and can't be debunked, they ignore it.