The John-Henry Westen Show - June 20, 2023


ALERT: United Arab Emirates buying Russian gold!


Episode Stats

Length

30 minutes

Words per Minute

152.37134

Word Count

4,681

Sentence Count

277

Hate Speech Sentences

4


Summary

The United Arab Emirates just made a record-breaking purchase of 75 tons of gold! What does this tell us about the direction of the world's largest holder of the precious metal? And what does it mean for the future of the dollar?


Transcript

00:00:00.000 You don't want the remorse of saying to yourself, you know, I really saw all this coming,
00:00:05.200 but I didn't do anything. I didn't take any action. We think, we just encourage you,
00:00:10.120 take action. It's actually a very easy process.
00:00:19.960 Hey, my friends. You know, there are many of you interested in the world of finance.
00:00:25.260 Yes. Little did I know. But we've got someone who we've had on a few times before. His name is
00:00:31.060 Drew Mason. He's our partner over at St. Joseph's Partners, where LifeSite readers have been
00:00:36.660 directed to, to be able to fulfill their needs for gold. And Drew explains to us the need for that,
00:00:43.620 but something just happened. The United Arab Emirates made a record purchase of gold. I think
00:00:50.740 it was like 75 tons from Russia. And so we're just going to find out what that's all about,
00:00:57.000 what's going on with the market volatility and all those kinds of things. This is the John Henry
00:01:03.060 Weston show. Stay tuned. Hey friends, this July, we at LifeSite are celebrating 25 years of service
00:01:11.400 to life, faith, family, and freedom with a gala in Toronto, Ontario, Canada. So especially for those
00:01:17.280 of you who couldn't join us in the United States, LifeSite is gathering our whole team and a few
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00:01:50.120 with our reporters from all over the world, including U.S. Bureau Chief Doug Mainwaring, Canadian
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00:02:22.480 so RSVP and get your tickets today for LifeSite's 25th anniversary Canadian gala in the beautiful
00:02:29.360 Hilton Toronto Markham Hotel this July 18th. To buy tickets for the 25th anniversary Canadian
00:02:36.620 gala, visit gala25can.lifesitenews.com. I look forward to seeing you there. God bless you.
00:02:44.840 Drew Mason, it's so good to be with you again. Thank you for having me, John Henry. Praise be
00:02:52.020 Jesus. Let's begin as we always do with the sign of the cross. In the name of the Father,
00:02:58.380 and of the Son, and of the Holy Ghost. Amen. Drew, just before we start, I wanted to say a big thank
00:03:05.700 you. You're a sponsor for the Canadian gala of LifeSite News, our 25-year celebration here in
00:03:12.360 Canada. Thank you for that. Well, thank you, John Henry. And I want to say it has been a pleasure
00:03:18.460 getting to know the LifeSite members and supporters. Our team has enjoyed working with the salt-of-the-earth
00:03:25.640 people very much and to encourage our fellow Canadians to invest in the metals because we
00:03:34.620 think it is a very prudent thing to be doing. For any Canadians who open a retirement account ahead
00:03:39.720 of the gala, we will compliment you with dinner to come to the gala, meet the LifeSite team, and
00:03:47.160 look forward to hopefully seeing you there. Absolutely beautiful. If you want to make an investment
00:03:54.120 into gold through the LifeSite News partnership with St. Joseph's Partners, please go and click
00:03:59.480 the link below this video and that you can see on the screen here. So, Drew, tell us about this.
00:04:06.180 What happened with United Arab Emirates and with this record purchase of gold? What's going on?
00:04:13.040 I think there are a couple of things investors want to really think about what this is saying. First of
00:04:18.000 all, we see the UAE, and you were right, 75 tons of gold making this massive purchase as a vote with
00:04:26.020 their wallets to decrease exposure to the dollar and currencies and to increase their exposure to
00:04:33.180 physical gold. So as these planners, very powerful, obviously in the Mideast, look at the world, how it's
00:04:40.540 unfolding. They are consciously deciding that even though they had a significant allocation to go already,
00:04:46.220 they want to increase it further based on risk reward and what they see. The other notable
00:04:52.220 point of this is they chose not to buy the gold from a country that was aligned with the United
00:04:59.000 States. They rejected the United States and deliberately went to a country that the White
00:05:04.180 House is sanctioning, and they're buying it from Russia, making a clear statement as to where
00:05:09.760 they're seeing their alliances move in the future, as we're seeing repeated again and again throughout the
00:05:19.240 world of nations voting to go with the BRIC nations and are rejecting the U.S. dollar and America's
00:05:29.360 alliance.
00:05:30.200 Tell us, what will that do? And there's been a lot of talk about that already. You've discussed
00:05:36.780 it here before, but what would happen if the reserve currency of the world moved away from
00:05:44.800 the U.S. dollar, or even started to, as it seems to be right now? What then happens to the dollar,
00:05:49.880 and how does that affect gold?
00:05:52.160 So we do have precedent for this in history, going back to the Portuguese escudo,
00:05:57.340 and the most recent case was Great Britain in the 1800s. And so we know it's a finite amount of
00:06:04.520 time throughout history when a currency unbacked as the dollar is ultimately loses its value and loses
00:06:11.700 its place on the central stage. And that will be a game-changing moment for Americans. What we see
00:06:18.940 again and again in history, whoever is benefiting the most from the paradigm is usually the last
00:06:23.640 to see the change coming. I think Americans are part and parcel for that today. We have
00:06:28.460 so benefited by the unique role the dollar has had that we are really oblivious to these changes and
00:06:36.540 what it means. And we will no longer be able to just print money to buy assets from overseas. We'll
00:06:41.200 have to earn that. And so what we see these central banks doing, diversifying away from
00:06:48.940 dollars to gold, is exactly the strategy we suggest families need to consider with urgency. Because
00:06:55.580 we now have the majority of the central bankers in the world polled, are stating as well that gold
00:07:02.780 will become a more important reserve asset moving forward, and dollars will become a less important
00:07:09.100 asset. So for all the investors watching, if you have, just think about the exposure you have to the
00:07:15.180 dollar. And our recommendation is you want to diversify, have some metal. Gold again thrives.
00:07:21.580 It has this beautiful uncorrelated nature to stocks, bonds, and real estate. And that bodes well.
00:07:28.860 There's been some other major news that I think investors would want to be aware of John Henry since
00:07:34.380 we last spoke. And what we saw was one of the world's largest mining companies, Newmont mining,
00:07:40.940 announced that they were shuttering their silver mine in Mexico over the disagreements with the
00:07:47.420 government where Newmont no longer feels the government is honoring their agreements as they had
00:07:52.940 originally put in writing. And so we have in 2023 this situation where we were already going to see a
00:08:02.300 record deficit in terms of silver production relative to demand as silver demand is exploding
00:08:09.340 industrially. And now we have the second largest mine in the world and the largest silver mining
00:08:15.260 jurisdiction taken out. So we continue to see the recurring theme where supply is pressured. Those
00:08:23.020 are stories that are echoed by other large miners while demand is strong. And we had another major data
00:08:30.780 point just last week. Just to be clear before we go on from there, when supply is short and shorthand,
00:08:38.140 that drives the price up of the precious metal, correct? Amen. Yes, absolutely.
00:08:43.260 Sorry to make it so super simple. For me, that needs to be. So, you know, silver investments,
00:08:49.980 which you also do through our partnership at St. Joseph's Partners, obviously people can buy silver
00:08:55.580 there as well, not only gold. And so silver has this great potential right now because of this. Is that
00:09:01.100 correct? Absolutely. We think they're both very undervalued, whether you look at the price of the metals
00:09:07.980 relative to debt, the price of the metals relative to the US's official backing. You look at the past
00:09:15.740 trough to peak moves that the metals have had. You look at current allocations, Western investors still
00:09:23.260 have less than 1% of their assets in the metals, despite how late we are in the cycle, despite valuations.
00:09:29.820 So, yes, we think while the number one reason to buy metal, gold and silver, is defense. I mean,
00:09:39.420 we suggest people you buy it for wealth preservation because the valuations of stocks and real estate,
00:09:46.060 they're at such extraordinarily high levels already. History tells us when you invest at such a high
00:09:54.300 valuation, the future returns are usually uninspiring at best, often really negative.
00:10:00.220 In contrast, interest in gold is low. And we think that's going to be changing among Western
00:10:06.540 investors as we see more and more of these data points coming out. But we think, ironically,
00:10:13.980 it's so ironic that what history shows in that gold has been such a defensive asset to protect your wealth.
00:10:22.140 Ironically, we think we're moving into a period where it also has very attractive upside.
00:10:27.980 Obviously, we can't guarantee anything, but we have all this data that suggests that's what's
00:10:33.100 happening. And we had a really extraordinary event happen again this week that may resonate with a lot
00:10:39.100 of the viewers. We had mentioned before that we have been seeing the most sophisticated Wall Street
00:10:45.180 firms, Blackstone, BlackRock, giving back. Now it's in the billions of dollars of commercial real estate
00:10:53.740 because they couldn't make it work. They have debts, and as they roll over their debt at these rates,
00:10:58.940 they're underwater. And they don't see a way to make it economically feasible. And we just got another
00:11:05.020 very public data point about that. Last week, the largest hotel in San Francisco, the Hilton Union Square,
00:11:12.940 over 1900 rooms, officially on the books, had $1.2 billion with over 50% equity on the books, meaning
00:11:23.420 officially the owners had over a half billion dollars of equity in that, of wealth. And they let it go.
00:11:32.380 They let it go for nothing. They walked away and handed the keys to the hotel back because beneath
00:11:39.180 the superficial writings from their attorneys and their accountants and their, you know, whoever,
00:11:45.260 their auditors, beneath all that superficial language was the reality that real estate has been
00:11:54.220 artificially elevated by government purchases of bonds. And as that is starting to unwind,
00:12:01.820 there's no reason to be there. You can't make these numbers work. So just see how that plays out. Because
00:12:07.100 we see over a trillion dollars in commercial real estate that is going to need to be refinanced
00:12:13.980 in the coming years. And it's going to be challenged. Because again, it's deals like the
00:12:19.660 Union Square. These are not, you know, one off little projects. These are some of the most intensely
00:12:27.020 scrutinized assets. You just can't make them work. And so people who have hidden in real estate,
00:12:33.980 because it's a real asset, it's tangible. And this isn't obviously all real estate, right? We're
00:12:38.940 talking in this case, particularly commercial. But there are similar concerns about the valuations
00:12:45.740 of residential real estate. But people who have hidden in that haven't really thought through
00:12:51.180 that because bonds were artificially rich with $10 trillion of stimulus from the government,
00:12:56.540 that stocks and real estate have been artificially propped up. And so they don't have histories
00:13:02.700 telling us with the data and the valuations, they don't have the protection to their wealth,
00:13:06.540 and their retirements. Like they may think, conversely, the fact that those assets are
00:13:11.980 trading at artificially rich levels means we believe gold and silver, which are inversely correlated,
00:13:19.740 are actually very attractively valued right here. So those are the data points that we have seen that
00:13:27.580 we thought were some of the most significant since we last spoke. And I wanted to update the audience with.
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00:13:56.220 by a brilliant sunburst and draped with olive branches. They, of course, commemorate our 25 year anniversary
00:14:01.500 of LifeSite news. We began in 1997 in September. So September of 2022 was 25 years. These one-ounce
00:14:08.780 silver rounds are available from our partners at stjosephspartners.com, where you can fulfill all
00:14:14.540 of your silver and gold needs in this perilous time. May God bless you. What have you seen over time
00:14:23.660 about gold and where we are today? Gold and silver, all precious metals, and where we are today? What
00:14:30.300 indicators for you suggest that now is really high time for people to start paying attention to
00:14:37.340 precious metals? In my opinion, John Henry, I think we have a generational setup. And I use that word
00:14:45.340 by choice, meaning this is a once in a generation type setup, because all the factors that you consider,
00:14:52.780 I think, are lining up for the metals. So first of all, think back to what we discussed on our first
00:14:58.460 program. The most important economic indicator in valuing stocks, bonds, and real estate are interest
00:15:05.500 rates. Because when you discount those cash flows back, the higher interest rates or the higher inflation is,
00:15:11.580 the less value your stocks, bonds, and your real estate have because the cash flows in the future
00:15:16.940 won't be worth as much when you get them because of the higher inflation rate. So for most of our careers,
00:15:23.980 for most of our careers, interest rates and inflation have been on a one-way decline. It started in 1980,
00:15:32.220 and it didn't end until the COVID fiasco in March of 2021. So for literally a whole generation,
00:15:38.460 rates and inflation were coming down. That meant multiples should have expanded. Well, what actually
00:15:46.220 happened? In 1980, the S&P, the Standard & Poor's index in the stock market, was trading at eight times
00:15:53.580 earnings. By the time we hit 2021, that was, depending on when you're looking, 50 times. So that's exactly
00:16:01.500 what you would expect to happen. And although the market has receded, we're still at valuations,
00:16:07.740 but by many metrics are what were prior peak bubble valuations of the market. So they're still so rich.
00:16:16.620 So we see this turn in rates and inflation as not being transitory or a few months, but being really problematic.
00:16:25.740 Why? Because consider the money printing that's gone on and what you're seeing happening again and again with
00:16:33.740 countries like the UAE walking away from the dollar. As the purchasing power of the dollar decreases,
00:16:42.620 that is not going to be conducive to bringing inflation down. So we think we are in the early stages of
00:16:49.020 problematic inflation that is going to be very positive for gold and silver and will reward investors
00:16:57.900 for that. Then consider the choices, right? Because making it super simple, what is gold? Gold is money, period.
00:17:07.900 It's not this asset, this commodity that doesn't have any real practicality. Gold is money. And as
00:17:18.700 America's central bankers admitted, the head of the Fed, it is the world's premier currency bar none.
00:17:24.620 Nothing can compete against it, even the dollar. That's our former Fed Chairman Greenspan speaking.
00:17:30.620 That's what we're seeing happening with the UAE and those other quotes that we referenced before,
00:17:35.260 the central bankers moving towards that. So if gold is this money that is very constrained in supply,
00:17:45.740 and we have basically no allocations to it among Western investors, as the debts in these Western
00:17:53.340 currencies increase, people are going to reach for gold. So we have this tight supply, the underallocation,
00:18:02.060 we said rates are inflation is going to be sticky. And when you consider on a global basis that all the
00:18:11.180 major currencies in the world now are really tracking towards either bankruptcy or the inability to pay
00:18:17.580 their debts, whether you're talking about the US, Japan, Europe, Great Britain, China,
00:18:23.020 we can't pay these debts down without cheapening the currency. So we have this synchronized
00:18:31.500 move towards currency bankruptcies that is unprecedented in history, where we're going to have people from
00:18:39.500 all over the world looking for what currency will protect their value. So that is extraordinary.
00:18:47.420 And when you lastly consider how small gold is as a percentage of global wealth. So by virtually every
00:18:57.420 investment bank's best estimates, gold is less than 1% of global wealth. So let's say you want to put
00:19:06.860 3% of your portfolio into gold, we would say history is clear, that's too low. But let's just say conceptually,
00:19:12.940 Western investors wake up and they say, yeah, we want some gold as an uncorrelated wealth diversifier,
00:19:20.220 wealth protector. It's not that you just then see the price of gold go up by 3%. Because the math as
00:19:28.700 you play it through, these other assets they're getting out of are 99% of wealth versus gold 1%. It's a
00:19:34.700 much bigger shift into gold. And the move in the gold price to accommodate that
00:19:40.700 could be very, very interesting. So when you think about all the things, we think that this is an
00:19:47.820 extraordinary setup that bodes well for gold as an asset diversifier in the portfolio.
00:19:55.100 Okay. I'm going to probably butcher something, but you can clear it up for me. I had a friend who is
00:20:01.980 an investor talk about something that exemplifies the staying power of gold versus inflation and money
00:20:10.060 devaluation, talking about U.S. currency. He talked about, I think, the 1920s when to buy a gentleman's
00:20:16.700 suit was like $5. Today, that same gentleman's suit, fine suit is $1,200. But back in the 1920s,
00:20:27.900 it also cost one ounce of gold. Today, it still costs one ounce of gold. And it was just an example
00:20:38.780 of showing the staying power of gold versus the transitory power of the dollar. If you can clean
00:20:43.740 up that example, but tell me if that still resonates. Absolutely. That's exactly it.
00:20:48.620 That's exactly it, John Henry. And so someone who's buying a suit today may convert their gold
00:20:54.460 into the currency of the day, whether it's dollars in the U.S. or Canadian dollars in Canada or euros,
00:21:00.220 but you have the gold, you have this currency to convert into, and you can buy those goods. It has
00:21:05.820 protected your wealth. Whereas if you had kept those paper dollars instead of holding physical gold back
00:21:12.620 then, it had basically no purchasing power at all to speak of. And it's a great example. And what's
00:21:19.580 so interesting, John Henry, the more people dig into gold and the history behind it and how it has
00:21:25.260 simply worked, because finance is supposed to be about the data. No opinions, it just has worked.
00:21:30.540 You can literally go back to manuscripts from ancient Greece, and you can triangulate on what people
00:21:36.060 were paid in a day's wages and what they would pay for clothes. And you can see that the purchasing power
00:21:43.820 of gold literally goes back to other civilizations, and it has still remained intact. Whereas basically
00:21:51.340 any other financial asset you would have bought at that time would for all intents and purposes be
00:21:56.380 worthless today. Now, one of the interesting things about silver versus gold is that it's a lot more
00:22:04.540 affordable. An ounce of gold makes some people swallow and go, okay, how are we going to do that?
00:22:11.580 Yet silver is much more reasonable. Tell us about that. And you've mentioned already there's a great
00:22:17.740 potential for silver, particularly now with the closure of that mine in Mexico, the second largest one in
00:22:23.980 the world. Tell us about silver and its affordability. Yes. So if you think back,
00:22:33.260 the founders of the United States were so brilliant. When they set up the Constitution,
00:22:38.620 the United States, they did not put us on a gold standard because they appreciated,
00:22:43.260 while what's good for gold is good for silver, they had very different attributes. And they made a very
00:22:48.380 noble move to protect the working class. So that embedded in the Constitution is the direct statement,
00:22:55.500 the only legal currency in this country shall be gold and silver. So gold more for bigger ticket items
00:23:02.940 that is more easily transported, right? Silver, however, has to do with wages. So if you had someone
00:23:10.220 working in the fields or today working in the factory, if you paid them in silver, it was a currency for day-to-day
00:23:18.460 living, but it was a currency that would protect the worker. And because silver, again, protects value, it is
00:23:26.860 a money. And if you look at, again, the results, you know, look at the data, look at what happened when
00:23:33.340 workers were paid in silver and they could take their paycheck from the factory and they could convert it
00:23:40.140 into real silver. While that was in place, the American working class was the envy of the world
00:23:47.580 because they weren't financially sophisticated, right? But they would go to the factory, they come home,
00:23:52.300 they would be saving in silver and it would preserve value. And that was the case up until 1963,
00:23:58.700 when LBJ did a horrible thing and destroyed the silver backing of the Constitution. Up to that point,
00:24:05.340 anybody again could come in and exchange their paycheck for silver. And if you look at what's happened
00:24:10.220 to the middle class in 63, it has been decimated. It has been decimated because these, no one sent out
00:24:16.780 the working class this warning that the Constitution has now been broken, that you're no longer going to be
00:24:21.820 paid in a currency that is silver, that has protected wealth for centuries, and no one knew. And
00:24:27.900 none of the middle class knew that was a big thing that would happen. So we would suggest that
00:24:33.900 really investors want both. They want both. It depends on the investor's particular preferences.
00:24:38.700 We talk them through that and what is most important to them. But you do want both because
00:24:45.580 if you think back again to what history shows us, 100 years ago this year, John Henry, very interesting how
00:24:53.660 history rhymes. 100 years ago this year, Germany, Weimar, entered the year and the gold mark had lost,
00:25:03.500 I'm sorry, the mark, the German mark had lost value relative to what was called a gold mark. So basically,
00:25:10.460 you could take your paper mark, your paper currency in Germany, and exchange it for a gold mark,
00:25:16.300 a gold coin. A few years before 1923, that ratio was five to one, eight to one, 10 to one, very close.
00:25:26.060 By the time we entered 1923, it was already over a thousand, call it maybe 2000 to one. Sound familiar?
00:25:35.100 By the end of 1923, you needed trillions of paper marks to exchange for the value of one gold mark. As the debts became
00:25:46.220 unpayable, the value of the paper compressed and the relative value of gold and silver exploded. When that process
00:25:55.340 matured, what the European leaders said they needed most to restart their economy was small form silver.
00:26:05.660 Why? Because that was a currency that day to day transactions could be done. So think about John
00:26:11.500 Henry, if we're in Germany 100 years ago, and you're selling steaks, and I come into you and I say,
00:26:19.900 hey, John Henry, I want to buy some steak. And that's why you're in business. And you have an inventory
00:26:26.460 that is perishable, right? But if I pull out 20,000 paper marks, you're thinking to yourself,
00:26:35.820 do I really want to take these paper marks that are on their way to worthlessness? What can I take?
00:26:41.580 I got to sell these steaks. What can I take? What the European leaders understood was they needed to get
00:26:47.260 small form silver into the hands of the people. So then I could come in to John Henry and I could
00:26:52.860 say, hey, here's some silver coins. And you would gladly take this silver for your steaks because
00:26:57.820 you knew you're getting paid something that's going to preserve value and you're doing business,
00:27:01.100 which is what you wanted to do. And so history suggests that silver is an ideal currency for wages
00:27:11.020 and for day-to-day transactions. If you look at it today too, John Henry, silver is the only asset that
00:27:17.900 we can find on the planet that is still trading below its 1980 peak. And that's significant because
00:27:27.660 we talked about this inflationary cycle and the declining interest rate cycle that lasted from 1980 to
00:27:35.100 2021. Every other asset, when you look at the 1980 level, is trading well above that price. Silver is
00:27:42.940 the only one we can find and it's trading right now at about half its 1980 price. Meanwhile, demand for
00:27:49.020 silver is exploding in that it is needed for cell phones, for laptops, for hybrid car batteries,
00:27:57.580 for electric vehicles, for basically anything that the world thinks of as next-gen energy needs silver.
00:28:04.780 And it's still trading so deep. So we suggest that as investors deepen their allocations,
00:28:13.580 and again, to understand more and more about metals, they want some of each.
00:28:18.380 Beautiful. Drew, any final thoughts for us?
00:28:24.060 You know, John Henry, we hear clients coming back now and telling us
00:28:28.940 that they're actually when they travel overseas, these are American clients finding increasing
00:28:37.420 resistance to being able to use their dollars if they're trying to use cash. People don't want them.
00:28:43.420 So these are all kinds that speak to an urgency. I'm not saying panic, but when all these data points are
00:28:52.380 lining up, I would submit to you, you don't want the remorse of saying to yourself, you know,
00:28:57.660 I really saw all this coming, but I didn't do anything. I didn't take any action. We think,
00:29:02.940 we just encourage you, take action. It's actually a very easy process. We're happy to step you through
00:29:08.860 every part of that journey. Make it as easy as we can, whether it's for a retirement account or however
00:29:15.180 you want to frame it, but be ready because we never know when that inflection point is going to happen.
00:29:22.460 And if you have an allocation of the metals and, you know, the feds and the other central banks are
00:29:29.660 able to bubblegum things together for a while longer, that's okay. This is your hedge, but you
00:29:35.980 don't want to be in a situation where you didn't have a hedge and all you had was car-related assets
00:29:40.300 with tons of dollar exposure that the world's walking away from and have remorse like people
00:29:45.500 did in Britain the last time there was a sole reserve currency who didn't diversify because
00:29:50.780 then it can take literally a generation to get back to where you were when it's so easy to protect
00:29:58.220 wealth and gold today. Drew Mason, so good to be with you. Folks, click the link below or the link
00:30:04.700 you see on the screen here. This is where to go to fulfill your needs and protect your families.
00:30:11.660 God bless you, Drew, and thank you so much. Thank you, John Henry.
00:30:17.180 And God bless all of you, and we'll see you next time.
00:30:19.740 Hi, everyone. This is John Henry Weston. We hope you enjoyed this program. To see more like it,
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