The Tucker Carlson Show - Ray Dalio： How to Survive the Coming Civil War and Plot to Use Debt and CBDCs to Enslave You

00:00:00.160 Ray Dalio, thank you very much. We spoke last year in exactly this place and you outlined in part kind of the cycle that you see in civilizations vying for supremacy of the world.

00:00:13.180 And not everyone, I think, kind of bought into your views on this and you were derided as, you know, Jeremiah's scaring people and everything.

00:00:21.160 A year later, you have a new summary of ideas that you've been formulating for a long time out this week and about 18 people have sent it to me.

00:00:30.580 And so I think we've reached a moment where people are ready to hear what you're saying.

00:00:33.440 So if you wouldn't mind outlining in whatever detail you like the cycle that you see the countries go through and where our country, the U.S., is in that cycle.

00:00:43.720 Gladly. Yeah, so there's a cycle.

00:00:48.600 There are orders. There are systems, right?

00:00:53.340 So there's a monetary order.

00:00:56.820 How does the economy work?

00:00:58.540 You put in money, creates credit.

00:01:00.620 People with credit do things with that.

00:01:03.060 They borrow.

00:01:03.780 If they can earn enough money to pay back, the system works well.

00:01:08.440 They create productivity.

00:01:09.720 They create opportunities, the capital markets and so on.

00:01:12.860 That's the monetary system.

00:01:14.300 And the way that works in the cycle is that when there's no debt, such as in 1945, we start a new monetary order.

00:01:24.860 There's no debt.

00:01:25.680 There's a system.

00:01:26.640 And it builds up over a period of time.

00:01:28.680 And it's a mechanics that when debt service payments rise relative to incomes, it squeezes out other spending the way it would do for you as an individual, the way it would do for companies, except governments can print money.

00:01:45.460 But that squeezes out spending, and that becomes a problem.

00:01:49.940 And then you also have a supply-demand problem.

00:01:53.560 So when you have a new monetary system, which the United States had the new monetary system, and the dollar was the world's reserve currency, then you can sell a lot more of the debt.

00:02:06.720 So there's a supply and a demand, right?

00:02:09.540 And so when that builds up, and everybody's one man's debts or another man's assets, and they build up holding a lot of dollar-denominated debt, and then they sell a lot more debt, then there's a mechanics of that supply-demand.

00:02:24.000 And then when you have politics and world politics, geopolitics enter into it, that monetary system is more at risk for those reasons.

00:02:32.860 We'll get into that.

00:02:33.860 But the first force of these five forces is the mechanics of this process, which is the monetary system.

00:02:42.260 The second is there's a domestic political order.

00:02:46.240 All countries have an order, a system, and all these orders change, and they evolve.

00:02:51.380 And, of course, that is connected to the economic system.

00:02:56.360 And so when you get large wealth and values differences, and there's a sense that the system isn't working for them and there's greater polarity, there's the emergence of populism, like in the 30s, you know, the left and the right.

00:03:11.040 And that populism gets to the point that there are irreconcilable difference.

00:03:16.740 In other words, the lack of willingness to compromise, the lack of willingness to accept loss, losing one's vote, and so on.

00:03:27.040 But a fight and win for me at all costs.

00:03:30.020 Like in the 30s, four democracies chose to be autocracies because the polarity was so great and the willingness to go along with that democracy system ceased to exist.

00:03:42.400 So that dynamic has happened throughout history.

00:03:45.900 And then the third is the geopolitical order, how countries work relative to each other.

00:03:54.100 What's the system?

00:03:55.380 And after World War II, we created a system, a multilateral system, in which it was in some ways naive, but it was very different than existed before,

00:04:06.200 in that by being multilateral, having United Nations, a World Trade Organization, a World Health Organization, a World Court, and all of those,

00:04:14.620 the idea of being representative and they would make decisions in a certain rule-based system was the path.

00:04:23.960 And, of course, the problem of that is that any system has to have its enforcement.

00:04:30.580 And if the system as a whole, a multilateral system, is not consistent with the interests of those who are the most powerful, you know, power rules,

00:04:40.640 and so you have the dynamic of the breaking down of that order, right?

00:04:45.440 So we're breaking down the monetary order in a very classic way.

00:04:49.620 We're breaking down the political order in a very classical way.

00:04:53.100 We're breaking down the geopolitical order.

00:04:55.420 So those orders, we have to recognize throughout time, all of those orders have changed.

00:05:01.040 There's never been a time that they haven't changed and haven't broken down in their issues,

00:05:05.260 and they're getting back to how they were in some ways in the past.

00:05:09.500 Number four is acts of nature.

00:05:12.100 Drought, floods, and pandemics have killed more people than wars, so you can't ignore it as a big influence.

00:05:17.560 And number five is the inventions of new technologies, particularly, you know, fabulous new technologies come about,

00:05:26.400 and they're important not only for prosperity, but they're important in wars.

00:05:30.480 You know, whoever wins the tech war wins also the economic and the geopolitical war.

00:05:36.340 And so there's that dynamic, and that dynamic is when there's rising powers challenging in existing powers.

00:05:43.840 There's no court to go to.

00:05:45.300 There's no way of resolving that.

00:05:46.720 There are tests of these powers, and we're in a power type of dynamic.

00:05:51.260 Now, when you understand that that dynamic works through time, and you get down to its individual symptoms.

00:05:59.760 In other words, there's, in my book, Principles for Dealing with the Changing World Order, which I wrote about five years ago.

00:06:07.280 I took, and I broke that cycle into five parts of the cycle, six parts of the cycle.

00:06:13.660 And like a disease, you can see the symptoms in those parts, and you can see it progress, and you can see the choices that exist at those stages.

00:06:24.220 So when you're in a different stage, the leadership has a different stage.

00:06:28.860 And all I wanted to do, whether it's in that book or in our conversation here today, is to try to let people see that.

00:06:40.400 And I'm just a practical investor, right?

00:06:44.620 I've been, for 60 years, I've been a macro investor.

00:06:48.080 So I have to bet on what the future is going to be like.

00:06:51.940 I place financial bets on that.

00:06:53.960 And now I'm at a stage in life that I want to pass that along.

00:06:57.080 So I hope that we could talk about or look at that in a dispassionate way to say, how does the machine work to produce that dynamic?

00:07:06.080 That's exactly right.

00:07:07.100 And you're not casting judgments here.

00:07:09.460 You're just acknowledging what has happened and what, therefore, is likely to happen.

00:07:13.380 Can I just go back?

00:07:14.080 I don't want to let this pass.

00:07:15.580 In the second factor that you described in this, the political factor, you pointed back to the very fraught decade of the 1930s.

00:07:22.040 And you said you had four democracies become or revert to autocracies because of the partisanship that became unworkable.

00:07:32.360 They couldn't reconcile, and so they became autocratic.

00:07:34.580 Is that a consistent principle, do you think?

00:07:37.900 Yeah.

00:07:38.960 You can look at it through Chinese dynasties.

00:07:42.360 You can look at it through Rome.

00:07:43.720 Like, who is in control, right?

00:07:45.900 But they, you know, Caesar in the Senate and being stabbed in the Senate.

00:07:51.540 Plato wrote about this, I think it was like 350 BC.

00:07:56.760 He wrote about the cycle in the republic.

00:07:59.080 In other words, democracies.

00:08:00.420 And the challenge of democracies where you vote and so on.

00:08:05.000 But then there's the wealth gaps and the rich gaps.

00:08:08.340 Yes.

00:08:08.640 And then who has the money?

00:08:10.200 And then the not willing to vote.

00:08:12.080 And then there's the power that changes.

00:08:14.500 Yes.

00:08:15.020 So partisanship becomes gridlock, becomes irreconcilable, just mass.

00:08:20.000 And then that evolves by necessity into autocracy.

00:08:24.020 Right.

00:08:24.820 When I'm no longer willing to accept that the system, the rule of the system, because everybody

00:08:31.620 thinks it's rigged, okay?

00:08:33.900 The Supreme Court, is it rigged?

00:08:36.060 Because that partisan has more appointees and it won't be fair.

00:08:40.420 And so I remember when the Supreme Court was kind of the Supreme Court.

00:08:45.080 And we lived in a time where we said the system is fair.

00:08:48.540 The legal system, when you go in and you're convicted, okay, is the legal system fair?

00:08:53.240 And so on.

00:08:54.040 And then you believe in that system with its imperfections and so on.

00:08:57.960 When that ceases to be the case, when the causes that people are behind are more important

00:09:05.660 to them than the system, the system is in jeopardy.

00:09:09.040 Right?

00:09:10.340 Yes.

00:09:11.960 Of course, by definition.

00:09:13.460 And all of this is relevant to where we are now.

00:09:16.140 So tribalism, whether it's political or ethnic, but when people square off into tribes and

00:09:20.600 they have no common ground and they have no hope of reconciling or compromising, then you're

00:09:25.360 getting a new system.

00:09:26.040 And you see it.

00:09:27.560 It's so interesting.

00:09:28.680 It's like watching a movie over and over and over again, because then you see how it

00:09:33.200 is they make stereotypes of the other.

00:09:35.520 Right.

00:09:35.960 The stereotype of this, that personality, the stereotype of that type, whether it's an

00:09:41.660 ethnic or economic or whatever it is.

00:09:45.260 Oh, they're one of those.

00:09:47.240 And I'm one of these.

00:09:49.100 And now it becomes the stereotypes that are fighting.

00:09:53.260 Right.

00:09:54.900 Which are non-human.

00:09:56.260 Right.

00:09:56.540 So it's easier to.

00:09:57.380 There's no empathy.

00:10:00.140 Of course.

00:10:00.740 Because it's not a human being.

00:10:02.240 It's a stereotype.

00:10:02.860 It's the fight.

00:10:03.840 Right.

00:10:04.140 And so then you have to pick a side.

00:10:06.600 I mean, one of three things.

00:10:08.180 You have to pick a side and fight for it.

00:10:11.000 Or you keep your head down and hope you don't get shot or flee.

00:10:16.620 That's it?

00:10:17.460 Throughout history.

00:10:18.960 Yeah.

00:10:19.140 And that's what's happening.

00:10:20.940 Hey, it's a brag, but we're pretty confident this show is the most vehemently pro-dog podcast

00:10:27.340 you're ever going to see.

00:10:29.380 We can take or leave some people, but dogs are non-negotiable.

00:10:32.820 They are the best.

00:10:34.380 They really are our best friends.

00:10:35.780 And so for that reason, we're thrilled to have a new partner called Dutch Pet.

00:10:39.780 It's the fastest growing pet telehealth service.

00:10:43.140 Dutch.com is on a mission to create what you need, what you actually need, affordable,

00:10:47.720 quality veterinary care anytime, no matter where you are.

00:10:50.940 They will get your dog or cat what you need immediately.

00:10:55.720 It's offering an exclusive discount, Dutch is, for our listeners.

00:10:58.760 You get 50 bucks off your vet care per year.

00:11:01.740 Visit dutch.com slash Tucker to learn more.

00:11:04.700 Use the code Tucker for $50 off.

00:11:06.900 That is an unlimited vet visit.

00:11:10.040 $82 a year.

00:11:11.240 82 bucks a year.

00:11:13.240 We actually use this.

00:11:13.980 Dutch has vets who can handle any pet under any circumstance in a 10-minute call.

00:11:20.980 It's pretty amazing, actually.

00:11:22.060 You never have to leave your house.

00:11:23.340 You don't have to throw the dog in the truck.

00:11:25.760 No wasted time waiting for appointments.

00:11:27.440 No wasted money on clinics or visit fees.

00:11:29.580 Unlimited visits and follow-ups for no extra cost.

00:11:31.980 Plus, free shipping on all products for up to five pets.

00:11:36.340 It sounds amazing like it couldn't be real, but it actually is real.

00:11:39.840 Visit dutch.com slash Tucker to learn more.

00:11:42.860 Use the code Tucker for $50 off your veterinary care per year.

00:11:47.000 Your dogs, your cats, and your wallet.

00:11:50.260 Got PC Optimum points?

00:11:51.960 Visit Shoppers Drug Mart for the bonus redemption event and get more for your points.

00:11:56.060 Friday, February 13th to Wednesday, February 18th.

00:11:59.060 Valid in-store and online.

00:12:00.180 Investing is all about the future.

00:12:05.900 So, what do you think is going to happen?

00:12:07.900 Bitcoin is sort of inevitable at this point.

00:12:10.400 I think it would come down to precious metals.

00:12:12.980 I hope we don't go cashless.

00:12:15.100 I would say land is a safe investment.

00:12:17.680 Technology, companies.

00:12:18.820 Solar energy.

00:12:19.840 Robotic pollinators might be a thing. 1.00

00:12:22.420 A wrestler to face a robot?

00:12:24.120 That will have to happen.

00:12:25.380 So, whatever you think is going to happen in the future, you can invest in it at Wealthsimple.

00:12:31.460 Start now at Wealthsimple.com.

00:12:33.660 Well, thank you.

00:12:34.520 So, you join, effectively, the Civil War.

00:12:37.400 You try and find a safe place domestically, or you just split?

00:12:40.700 Yeah.

00:12:41.040 In other words, you're quiet because you don't want to get into the fight.

00:12:44.780 You're going to get injured, right?

00:12:46.700 A lot of people are scared now, right?

00:12:49.780 People, you'd imagine, never would be scared, right?

00:12:52.880 I've seen those scares.

00:12:53.440 Right?

00:12:53.960 They don't want to speak up or something.

00:12:55.660 So, you keep your head down.

00:12:57.000 You either get in the fight and fight, pick a side and fight for it.

00:13:01.940 Throughout history, this is true.

00:13:03.460 Pick a side and fight for it.

00:13:05.200 Or keep your head down.

00:13:07.460 Or, in some cases, flee.

00:13:09.800 You know, people leave.

00:13:11.020 They go from, you know, immigration.

00:13:13.300 Think about how all the immigration largely has taken place.

00:13:16.200 There's some hell taking place in there, and then they move to someplace else where there's not.

00:13:21.760 Here we are in the UAE, okay?

00:13:25.120 A lot of people are coming to the UAE because they're fleeing, in a sense.

00:13:30.040 So, there's that dynamic.

00:13:32.140 And so, you can see many, many, many symptoms.

00:13:37.600 Like, there are things, you know, when it gets violent and when you get killing too many people.

00:13:47.440 Then you start to cross the lines.

00:13:49.500 You know, like, maybe in Iran, okay?

00:13:51.720 Do we cross the lines?

00:13:53.100 Yes.

00:13:53.320 And then where you, you know, there are these symptoms.

00:13:57.160 And there's financial, you know?

00:13:59.460 How do you pay?

00:14:02.080 So, I'm rambling.

00:14:03.720 No, you're not rambling.

00:14:04.660 But just back to the political, one last question.

00:14:06.720 Is it ever resolved?

00:14:08.160 Does the system ever stay intact when you get to a point where people just don't want to compromise at all

00:14:14.640 or even live in the same place?

00:14:16.340 Have you seen any example of where people sort of decide, wait a second, let's enter into power sharing

00:14:23.000 and pull back before this gets violent or we get a king?

00:14:29.840 In some places, sometimes in dynasties and so on, they're, but they're not often.

00:14:39.680 What happens is there's a reversal or a fixing by somebody who can not, who's strong enough to deal with the issues.

00:14:54.920 For example, we have a debt issue.

00:14:56.820 We have all of these other issues and can bring people together.

00:15:01.640 But there needs to be almost, Plato would say, the benevolent despot.

00:15:08.460 Yes.

00:15:08.760 And that's in his cycle.

00:15:10.860 In other words, there's somebody who can stop the fighting and be smart and impose the disciplines that are necessary.

00:15:21.760 For example, there's a financial discipline.

00:15:24.460 How do we deal with the debt and all the supply demand and so on?

00:15:33.500 Can we raise taxes?

00:15:35.060 Can we cut spending?

00:15:36.960 What are we going to do to bring about a budget balance or not a budget balance?

00:15:43.060 Let's say a deficit of 3% of GDP, which would sustain the set of circumstances.

00:15:48.800 What is that financial discipline?

00:15:50.800 What is that way of working together so we do not do each other harm?

00:15:56.940 Because we are at a point, let's say, as we come to the next midterm elections, you know, and there's a significant probability that the Republicans would lose the House and talk of even could be the Senate.

00:16:14.360 OK, now when you go after that and you imagine what the conflict can be like, how will that conflict work?

00:16:23.360 Will it be rule of law or will it be a win at all cost?

00:16:28.260 And as that win at all cost and what that means, is there rules?

00:16:34.740 Is there playing by the rules?

00:16:36.560 You know, that dynamic.

00:16:38.260 So this thing is repeated.

00:16:40.300 It's not easy to get to that point because you have to deal with, you know, how do we stop fighting with each other and how do we do the right things to get strong?

00:16:49.860 And that's a great challenge in history.

00:16:53.440 So where are we now, given the five factors that you outlined, where is the United States or even really the West will include Europe in this very familiar cycle of rise and fall?

00:17:04.420 In my book, I show 18 measures of health having to do with education, military, reserve currency, a number of measures that show strength.

00:17:20.300 OK, what is the level of strength?

00:17:22.340 And the United States is the strongest power, which has been in relative decline and experiencing these conflicts.

00:17:34.080 And that's measured if you go in the book, how principles for dealing with the changing world order, you'll see a number of charts.

00:17:41.460 So I don't want to just pronounce it that way.

00:17:44.080 I just want to say that like if you were to take education and you take scores, piece of scores and so on in statistics, you will see that there are rising powers, there are declining powers, there are large wealth and values differences.

00:18:02.120 And we are in what is what I call stage five, which means we are sort of at the brink, but not over the brink.

00:18:12.320 In other words, we're not there's a capacity to it's before a period of great disorder when there can be a monetary breaking down of the system.

00:18:27.620 You know, what is money? We should talk at some point.

00:18:30.360 What is money and can I can money be an effective storehold of wealth and what happens if it's not?

00:18:35.220 And so we are at what I would call stage five in a six stage cycle.

00:18:42.900 The sixth stage is when there's a breaking down of these orders.

00:18:46.720 We're not there yet, but we are close to there and headed in that type of direction.

00:18:53.720 What does a breakdown look like? What does stage six look like?

00:18:56.840 Well, from the monetary point of view, it is that the demand for the reserve currency is not sufficient to meet the supply.

00:19:16.500 So what that means is you see a supply demand problem.

00:19:25.380 You produce a lot of supply and the demand's inadequate and all things being equal, there will be a rising long rate while the central bank is trying to hold that from down by easing the short rate and shortening the maturity of the debt that it sells.

00:19:45.940 Okay, that dynamic and that then the currency, these debts and the currency falls relative to the non-fiat currencies, in other words, like gold.

00:19:59.180 In other words, you are seeing a movement by central banks and countries to hold gold as an alternative reserve currency, partially because of that supply demand situation and partially because they worry that there may be a payments problem.

00:20:23.460 And the payments problem, like it happened in Japan prior to World War II, you had an economic problem and the United States, sanctioned essentially, didn't pay the Japanese their debt, the money in terms of that, like a debtor creditor problem.

00:20:44.220 And they didn't make those payments, much like Russia, you know, they basically took control because they have the ability to take control of the treasuries and other things.

00:20:56.020 And so there is becomes more of a reluctance to hold that money as a movement more into the non-fiat currency, which is gold.

00:21:10.000 So in other words, other countries perceive a risk in holding dollars because, well, for lots of reasons, but one of them is like if the United States government at the time doesn't like you, they can grab your dollars.

00:21:23.520 That's right.

00:21:23.980 So it's not worth it.

00:21:25.120 Right.

00:21:25.300 And it's a risk that both the debtor and the creditor have to each other.

00:21:29.940 So think about it, China.

00:21:32.460 Yes.

00:21:32.600 And if you were thinking China, how do you feel about holding treasury bonds?

00:21:37.620 Okay.

00:21:38.380 So you may not feel secure about holding treasury bonds, both for two reasons, because you could be sanctioned or you also, because there's a supply demand problem.

00:21:49.800 So you start to see the movement in that direction.

00:21:52.960 And then, of course, it's also in that situation, governments want to control their supply demand.

00:22:00.480 So they might establish foreign exchange controls.

00:22:03.560 They might do certain things like that.

00:22:06.000 But they also feel vulnerable.

00:22:08.620 The United States can feel vulnerable if they can't sell enough of those bonds to others.

00:22:15.300 And if the demand isn't, because then interest rates would have to rise because of the supply demand, too much supply relative to the million.

00:22:24.100 To make it more appealing to buyers.

00:22:25.960 Yes.

00:22:26.820 And also to cut the demand for credit.

00:22:30.540 In other words, if the price rise, then people will borrow less and so on.

00:22:35.080 And that then has the effect of mechanically slowing down the economy.

00:22:39.460 That produces that result.

00:22:41.160 Then what happens is then the central bank comes in and it prints money and it buys the debt, which depreciates the currency.

00:22:50.840 That's the mechanics that's of the debt part of it that is related to the political and the geopolitical part of it.

00:22:59.340 That I'm answering your question.

00:23:00.260 May I just ask you something there?

00:23:01.000 So if foreign countries don't want to buy your debt and your central bank decides we're going to print more money and buy our own debt with it, which is what we're doing, wouldn't the people doing that stop and say, wait a second, this sounds like an electric windmill.

00:23:16.020 Like, what are we doing here?

00:23:17.460 This sounds crazy.

00:23:18.400 They're stuck.

00:23:20.280 They're stuck.

00:23:21.080 They're stuck because they have a deficit.

00:23:28.500 And the deficit will be there unless they raise taxes and cut spending or something.

00:23:35.140 And that's bad for the economy and it's politically bad.

00:23:38.980 Yes.

00:23:39.360 Okay.

00:23:40.920 Or you print the money and you make up the difference.

00:23:44.980 And so since the breakdown of the monetary system in 1971, that was when there were too many claims on gold and we had a system attached to gold.

00:23:54.460 And because they were in August 15th, 1971, I remember, well, I was clerking on the floor of the New York Stock Exchange after college, before I went to graduate school.

00:24:06.560 Richard Nixon gets on August 15th, Sunday night.

00:24:10.040 He gets on the television and he says, we're not going to allow the conversion of that paper money into gold and we're not going to, you won't get your gold.

00:24:22.580 I mean, I walked on the floor of the Stock Exchange the next morning.

00:24:26.720 I thought this is a big crisis.

00:24:29.300 And what they did is they essentially printed it and then we had the stagflation of the 70s.

00:24:34.780 But I was very surprised and I found out, I didn't, we never threw anything like that before.

00:24:41.880 I studied history.

00:24:42.680 I found out they did the exact same thing in March.

00:24:46.380 Roosevelt did the exact same thing in March of 1933.

00:24:49.920 Right after he got inaugurated.

00:24:51.020 Right.

00:24:52.080 Okay.

00:24:52.580 For the same reasons.

00:24:54.360 Okay.

00:24:54.760 Because your choice is to have a lot of defaults and a debt problem or to do that.

00:25:01.620 Right.

00:25:02.220 That's how it works.

00:25:03.600 That's how the machine works.

00:25:05.500 So, and at the end of the day, since 1971, when we went off the gold standard and we went to a fiat monetary system, we have always done that.

00:25:17.980 And, you know, the Fed put, you know, that's the way it is.

00:25:24.120 And it's kind of worked for 55 years.

00:25:27.620 but it's showing signs of breaking down.

00:25:29.540 Well, what it does is it's like using the hair of the dog that bit you.

00:25:40.920 Oh, it's the hangover cure.

00:25:42.260 Yeah, I'm familiar with that.

00:25:43.720 Okay, me too.

00:25:44.900 Yeah, for sure.

00:25:47.080 What you do is you give more money in credit,

00:25:51.320 and what happens is to get out of it,

00:25:54.400 because then you make it easier to pay the debt.

00:25:57.560 Like in 2008 or 2020, you give the money, okay,

00:26:04.580 and you give the credit, and you fund it, and you make that.

00:26:08.960 But that makes the debts go up again, okay,

00:26:12.660 until then you reach the point where the debt is squeezing on the expenditures,

00:26:20.700 and you have the supply-demand.

00:26:22.200 So that's why you have these big debt cycles, you know?

00:26:26.360 When we started this company,

00:26:27.700 we promised that we would only partner with other companies that share our values.

00:26:32.080 We didn't want to advertise products made by people who hate us,

00:26:35.100 or for that matter, you.

00:26:37.300 So with that in mind,

00:26:38.460 it is a pleasure to announce that we're working with Charity Mobile.

00:26:42.080 It is a pro-life phone company.

00:26:45.000 Charity Mobile holds a view on abortion

00:26:46.640 that almost every single major U.S. company disagrees with.

00:26:51.060 They think it's completely wrong.

00:26:53.300 It is sad.

00:26:55.100 And celebrating it is one of the darkest things this country's ever done.

00:26:58.340 We agree completely.

00:27:00.260 So when you switch your cell phone service to this American company,

00:27:03.360 they'll donate a percentage of your monthly price plan

00:27:05.640 to a pro-life, pro-family charity that you choose.

00:27:09.800 There's no better way to prove what their real values are than doing that.

00:27:14.060 No one would do that unless they meant it.

00:27:16.460 All their plans are under $50,

00:27:19.020 and you can keep your existing number and your existing phone if it's compatible.

00:27:23.180 Charity Mobile is a pro-life company serving pro-life customers

00:27:25.740 and supporting pro-life causes and has done it for more than 30 years.

00:27:29.180 Visit charitymobile.com slash Tucker.

00:27:31.240 Use promo code Tucker to get a free phone with free activation,

00:27:34.160 free shipping, and a free gift with every new line.

00:27:36.540 Things are feeling a little less human these days, aren't they?

00:27:39.560 But isn't the whole point of progress to make things more human?

00:27:43.600 That's why, at TD, when we design a product,

00:27:46.740 whether it's an app for making trading easier

00:27:48.740 or monitoring your account for fraud,

00:27:51.040 we ask one simple question.

00:27:53.300 How does this help people?

00:27:55.540 That's how we're making banking more simple,

00:27:58.360 more seamless, and more intuitive.

00:28:00.860 But most importantly, that's how TD is making banking more human.

00:28:05.080 So the new year is here, but that does not mean you've got to overhaul your whole life,

00:28:11.000 despite claims to the contrary.

00:28:12.360 You don't have to take drastic measures.

00:28:14.100 Make a few changes here and there, and you'll be a lot better off.

00:28:17.680 And you can start with the snacks in your pantry.

00:28:20.680 Now, products from standard American chip brands are, let's be honest,

00:28:24.280 pretty repulsive, filled with chemicals that make you feel heavy and bloated.

00:28:28.220 They don't even taste that good.

00:28:30.140 They're not good for you.

00:28:31.120 We recommend an upgrade with Masta chips.

00:28:33.620 Masta is the easiest way to eat clean without feeling like you're on a diet.

00:28:37.500 The chips contain three ingredients.

00:28:39.300 That's it.

00:28:39.680 Organic corn, sea salt, 100% grass-fed beef tallow, and that is it.

00:28:44.320 No seed oils, no mystery chemicals, just food, actual food.

00:28:47.820 And they're amazing, and you feel great after.

00:28:50.280 You don't feel weighed down.

00:28:52.500 We particularly enjoyed the Kobanero flavor lately, but they're all great.

00:28:56.600 You want to give them a try?

00:28:57.880 Visit masachips.com, M-A-S-A, chips.com, slash Tucker.

00:29:01.940 Use the code Tucker for 25% off your first order, or you can click the link in the video

00:29:08.200 description, or you can scan the QR code to claim this outstanding offer.

00:29:13.420 And if you don't feel like ordering online, you can buy them nationwide at your local Sprouts

00:29:17.500 supermarket.

00:29:18.080 Stop by and pick up a couple of bags before somebody else does.

00:29:22.000 So I think even people who are not really interested in monetary policy or macroeconomics

00:29:28.680 feel like there is a point at which this doesn't work anymore.

00:29:32.340 It just breaks.

00:29:33.580 It is.

00:29:34.000 It's happened all in all.

00:29:35.280 So what does that look like specifically, the debt crisis people keep talking about?

00:29:38.900 Well, because of that, my last book, my most recent book put out about a little less than

00:29:46.620 a year ago, is called How Countries Go Broke.

00:29:50.200 Yes.

00:29:50.560 The Big Cycle.

00:29:51.280 Well, and what I wanted to do is to just show 35 cases of it.

00:29:57.340 That is just the mechanics to show how it works, okay?

00:30:01.380 But it is that dynamic of the squeezing on the spending and the supply demand.

00:30:07.220 And then you start to see it where, as I was saying, the long rate goes up while the short

00:30:13.360 rate comes down because the central bank's pushing the short rate down.

00:30:16.660 And then they shorten the maturities of the debt.

00:30:19.980 And then the central bank buys that.

00:30:22.960 And then the central bank, now it owns all these treasuries.

00:30:27.260 And then the central bank starts losing money because they own the treasuries.

00:30:31.700 And they're going up.

00:30:34.040 So they have to produce the money and credit to keep that rate down.

00:30:41.060 And they lose more and more money.

00:30:42.940 And that dynamic then doesn't stop the change in the capital flows.

00:30:49.140 That's why you, and then traditionally in all of these cases, you see a move to the hard

00:30:54.160 money, the move to gold, okay, as we're seeing.

00:30:57.800 You see that dynamic in terms of that move to gold.

00:31:01.400 And then it starts to run its course.

00:31:04.800 So it's very much like, think about what happened from 71 through the 70s, produces more stagflation.

00:31:11.120 And then at some point, the inflation problem or the devaluation of money problem becomes

00:31:17.480 such that the central bank then tightens money and so on.

00:31:22.680 And the Volcker years.

00:31:23.540 The Volcker years, 1979, 80, 81, 82, right?

00:31:28.020 So the pendulum swings.

00:31:29.940 Think about it this way.

00:31:31.100 In order to have a balance, a successful economy, a successful capital market, since one man's

00:31:38.500 debts are another man's assets, you have to keep interest rates not so high that they crush 0.94

00:31:49.180 the debtor without having them so low that they are bad for the creditor.

00:31:59.680 Right.

00:32:00.820 So you see these cycles.

00:32:03.240 When we had zero interest rates and negative real interest rates, what you saw was massive

00:32:10.040 creation of credit and money and borrowing and so on.

00:32:14.060 And then you had that cycle.

00:32:16.260 So that's what the cycle looks like if you have losses.

00:32:19.920 And then you also have, under those circumstances, classically, the weakening of the central bank's

00:32:28.860 control, or I should say the strengthening of the central government's control over the

00:32:36.340 central bank.

00:32:37.460 In other words, when these things happen, then there is, they can't be at odds.

00:32:43.300 Okay.

00:32:44.160 And so there is greater control by the central government of this.

00:32:49.800 Are you writing the news?

00:32:52.380 No, I've just seen this movie before.

00:32:54.360 This is exactly what's happening.

00:32:56.560 I know, but that's what I'm saying.

00:32:57.920 Because it must happen.

00:32:59.740 But in the nature of that dynamic, when you have, imagine a fight between the central bank

00:33:08.520 and the central government in the middle of a crisis and so on.

00:33:12.820 So there is this control because there's a monetary thing.

00:33:16.340 Because there has to be.

00:33:18.240 Right.

00:33:18.800 What happens if you're the president of the United States or you are the leader in that

00:33:23.820 country and you are in this kind of a monetary crisis, it's like anything, any fight.

00:33:29.460 You don't want the internal fight.

00:33:31.160 You want to get control and there's a fight for control.

00:33:33.880 So we're living in a world today in which there are fights for control, right?

00:33:37.980 Who has the power and the fights for control?

00:33:41.000 So again, though, at what point do we know the system is just broken and this experiment

00:33:48.240 which began post-war 1945 has reached its end and we need something new?

00:33:51.880 So pretty much almost only in retrospect, what happens if you're really close up and you say,

00:34:04.560 when did they know that there was a breakdown?

00:34:08.080 Or when did they know that there was, let's say, the French Revolution?

00:34:13.120 There's a day that they say.

00:34:14.920 Storm of the Bastille.

00:34:16.000 Right.

00:34:16.920 And there's that day and they said it.

00:34:18.820 They didn't know that.

00:34:19.600 No, they didn't.

00:34:20.080 Just like some prison got raided or something.

00:34:23.120 They didn't.

00:34:23.420 Yeah, no, that's right.

00:34:24.180 Okay.

00:34:24.960 So when it's not like they announce it or it becomes clear cut, right?

00:34:31.280 You slip into those things.

00:34:33.040 There's never that clear moment.

00:34:36.060 But what happens next?

00:34:37.300 Like we heard Chairman Xi three days ago say, hey, by the way, China should hold the world's reserve

00:34:42.360 currency.

00:34:42.780 And that seems very far away now, I guess.

00:34:46.900 But maybe.

00:34:47.520 So you're asking me what I think about China's having reserve currency?

00:34:51.240 Well, the only reason I'm putting it, I have no idea if that's possible.

00:34:53.960 I can respond to it.

00:34:55.020 Tell me.

00:34:55.480 Yeah.

00:34:55.740 Okay.

00:34:55.960 I don't think China is going to have a, there are two purposes of a currency.

00:35:01.260 Yes.

00:35:02.120 Medium of exchange and storehold of wealth.

00:35:05.460 Right.

00:35:06.220 Okay.

00:35:07.320 Medium of exchange.

00:35:08.960 It's logical that China is going to have much more of a medium of exchange type of reserve

00:35:16.080 currency because it is right now the world's largest trading country.

00:35:21.300 Right.

00:35:21.360 And so people, central banks, want to hold some reserves in the things that they're trading in.

00:35:31.500 Of course.

00:35:31.820 And so on.

00:35:33.220 And so they, the Chinese have intentionally, in order to minimize that conflict, have not

00:35:39.520 pushed that thing. 0.58

00:35:40.400 And now they're going to operate and moving in that way.

00:35:44.260 As far as storehold of wealth, though, who's going to trust the Chinese with your wealth 1.00

00:35:50.300 and capital controls and so on?

00:35:53.180 I think that all fiat currencies have a problem.

00:35:56.860 Okay.

00:35:57.380 So they have the history of foreign exchange controls.

00:36:03.540 They have a, would you trust, it's anti-wealth protection.

00:36:07.480 And, you know, this is not, that's not their great track record of having, I'm going to

00:36:14.460 protect your wealth.

00:36:15.500 You, even private property and how it works in China is a new concept relatively.

00:36:20.740 And it's something that they're, you know, wrestling about.

00:36:23.680 They don't, you can't own land, you know, you can't own property.

00:36:26.940 So the storehold of wealth element is going to be very tough for them to sell.

00:36:32.640 So the world does not have what you want as a currency, as a reserve currency, other

00:36:39.220 than gold.

00:36:40.240 I mean, it's just a default, right?

00:36:42.300 Because it's a debt and, and gold is the, you know, like they say, it's the one asset

00:36:46.880 you can have that's not somebody else's liability, meaning you have to get money from somebody

00:36:51.460 else to do.

00:36:52.140 So I asked you last year off camera, I'll never forget it.

00:36:54.820 I've always been a gold buyer, but then I don't know anything.

00:36:57.760 I just, it just instinctively seemed like it made sense, but I've always been a little

00:37:01.520 bit embarrassed about it.

00:37:02.340 And so I asked you, is it crazy to, you know, take some money and buy some gold?

00:37:06.440 And you said, it's not crazy at all.

00:37:08.440 And I remember feeling vindicated, but also wondering like, why don't more people say that?

00:37:12.200 It almost feels like there was a conspiracy in the financial press.

00:37:16.100 I think all around, not only in, not only in, um, related to gold, but all of the things

00:37:22.640 I think people get used to what's credible to them is what they experience and the norm

00:37:32.580 that they have at that time.

00:37:34.820 And so much see that's happening.

00:37:38.840 You, I hear people say, I'm shocked by, but the only reason they're shocked is because

00:37:44.240 they've become used to that, right?

00:37:46.060 If you, if you were traveling through time and you went before 1971 and so on, and you

00:37:54.900 saw history and you saw the universal, universality of, um, money and gold and how the whole system

00:38:03.800 worked repeatedly over time, you would understand there's that dynamic that's taking place.

00:38:10.020 But yes, people think that they misunderstand.

00:38:13.460 They think it's a metal to speculate on, right?

00:38:17.340 They don't realize that actually it's a money.

00:38:23.360 Okay.

00:38:24.200 Central banks, second largest money.

00:38:28.440 Okay.

00:38:29.300 So when you're, it's almost like when you look at the world through that money, you can see

00:38:36.360 what things cost through that lens.

00:38:38.880 Exactly.

00:38:39.180 People are looking at it instead, like through a dollar lens and they see, um, gold go up.

00:38:46.420 Okay.

00:38:47.080 But that's not what they're looking at.

00:38:48.740 You could look at the world through a gold lens and see money go down.

00:38:54.440 Exactly.

00:38:55.060 Okay.

00:38:55.600 So all I'm saying is because of their experience and what it is, it's implausible.

00:39:01.520 It's like, you know, the, the, the, the tooth fairy or Santa Claus, you know, you, it, you, you believe in these things and so on.

00:39:10.460 And then you, you realize through the cycle.

00:39:12.900 And that's why surprises take place.

00:39:14.820 That's why it seems implausible.

00:39:17.260 Um, but if you read history, it's almost, you know, it's, it's logical.

00:39:24.060 Most security systems operate like old fashioned cable internet.

00:39:27.840 They're installed in one place.

00:39:29.360 They're tied to one address.

00:39:30.540 And if you move or your job moves, you got to start over.

00:39:33.000 But that's not how other people do it.

00:39:35.880 Construction sites, ranches, large properties.

00:39:38.580 They have a better way.

00:39:40.100 They need cameras that are portable, not tied down to one location.

00:39:43.980 Defend security cameras are the perfect solution for ordinary people to do this.

00:39:50.080 With Defend, you own the camera.

00:39:51.760 You're not renting it like a modem from a cable company and you're not locked to a building or a wifi network.

00:39:57.160 The job moves while then the camera moves with it.

00:39:59.840 That's a better way to do things.

00:40:01.160 No power lines or infrastructure of any kind is required.

00:40:04.700 These run on cellular, like your phone.

00:40:07.520 They're perfect for watching job site equipment overnight, livestock at your ranch, long driveways, outbuildings on your property.

00:40:14.360 You mount it where you need it.

00:40:15.800 You open the Defend app and you are set.

00:40:18.440 You got clear footage, night vision, alerts straight to your phone.

00:40:22.900 Defend never sells any data to anyone.

00:40:25.200 Not tech companies, not the government, not China.

00:40:28.700 Plans start at about five bucks a month.

00:40:30.860 If there's no contract, you can cancel at any time.

00:40:33.180 Visit DefendCellCam.com today.

00:40:36.900 DefendCellCam.com.

00:40:37.820 Your data is your lifeblood.

00:40:39.680 Protect it.

00:40:40.780 Acronym Solutions Cloud Backup as a Service shields your vital information with secure, always-on backups managed by industry experts.

00:40:48.780 Don't risk losing what matters most.

00:40:51.400 Visit AcronymSolutions.com.

00:40:54.080 So, you don't seem surprised at all by anything that's happened or is happening right now.

00:41:01.140 What are a few other things you would not be surprised to see in the near future?

00:41:05.080 For example, let's start with gold.

00:41:06.580 What would you not be surprised to see the spot price of gold per ounce in like five years?

00:41:10.880 I don't want to, you know, that's one of those headline presuming.

00:41:19.580 Let me say it this way.

00:41:21.060 Yes.

00:41:21.300 Because I think people pay too much attention to the spot price of whether it's a spot going to go up or down or whatever.

00:41:29.680 And what they don't do is think, if I didn't have any view on gold, what amount should I have in my portfolio?

00:41:38.320 In other words, if you did a portfolio construction exercise and you said, what is an effective diversified portfolio and what assets should I have and what amounts in that?

00:41:51.860 Because gold is a very effective diversifier and also a protector of this, during very bad times, gold does very well.

00:42:02.460 When the rest of your portfolio does poorly because, let's say, the 70s being a good example or the 30s being a good example, during those times, it's a diversifier.

00:42:14.500 Okay, so the optimal amount to have for an individual or a central bank might be different, but an individual would be, depending on what's in their portfolio, between 5% and 15% of a portfolio.

00:42:29.880 And so what I would say is, if you approach that question that way and you think, what should I have, you should have what we talked about before, a year ago, I guess, and so on.

00:42:43.160 You should have that particular amount somewhere in that neighborhood, depending on what your portfolio is like, because it's an effect of diversifier and it is a money, okay?

00:42:54.600 When the traditional money does badly, this money does well.

00:42:58.520 When the traditional money, which gives you an interest rate, then it's the reverse.

00:43:05.720 So that's the thing that I would try to convey to people, you know, okay, do you have some of that?

00:43:12.960 What's the amount that's your comfort level, you know, but have some?

00:43:17.680 So if you were running the United States or a country like the United States in its current position,

00:43:25.780 what would you need to do to protect your country in the midst of these changes, some of which are inevitable, some of which maybe aren't?

00:43:33.820 Like, what are the steps specifically that you would take to help your country?

00:43:37.480 I would be dealing with achieve something like a 3% budget deficit, not more than a 3% budget deficit.

00:43:52.840 I would try to minimize or eliminate, but minimize the risks of that dynamic I was talking about.

00:44:07.040 So you would get the budget deficit to 3%?

00:44:08.580 Yes, but, and I would say to every, I've said to legislators, I go down to Washington and, you know, leaders of both parties,

00:44:20.320 and I said, it's like being on a ship and everybody on the ship is headed to a rock and that,

00:44:34.800 and everybody knows that if you have a deficit of 6% or 7% of GDP, you're going to have a supply demand problem.

00:44:44.800 And I have the conversations, and by and large, this is the agreement.

00:44:49.320 And I don't care whether you turn left or you turn right in terms of that, but do not hit the rock.

00:44:55.360 And what if I would do is I would take a 3% pledge, in other words, say I will get it down there,

00:45:00.940 and if I can't agree on how, I would do it proportionately with three things.

00:45:05.940 I would, proportionately with taxes, spending, in other words, if you raised taxes by 4%,

00:45:14.440 if you cut spending by 4%, and you lowered, which would lower interest rates because it improved the supply demand

00:45:23.620 and it would also convey the message that it's being dealt with, you would also lower the interest rate on the debt.

00:45:30.160 And those two things would begin to get it to approach about a 3% budget deficit and so on.

00:45:38.140 But doing that would require, would be politically impossible.

00:45:44.720 So I have these conversations, and the answer is, you know, like, Ray, you don't understand the world of politics.

00:45:51.940 If I'm, I have to give at least one of two pledges, the pledges, and probably both.

00:46:03.320 The pledges is, I won't raise your taxes, and I won't cut your benefits.

00:46:10.940 Okay, you don't raise the taxes, you don't cut.

00:46:13.760 So there's a big move here, primarily, to try to grow your way out of it.

00:46:19.980 In other words, again, you know, stimulate fiscal and monetary stimulation and hope that that produces,

00:46:28.660 perhaps with the new technologies and so on, that's the idea, enough income growth and so on,

00:46:35.960 so that this moves toward that 3%, which is, in my opinion, a not likely occurrence.

00:46:44.540 Why is it not, it's not likely that technology will turn out to be so beneficial and lucrative that it kind of erases these problems?

00:46:54.420 Well, the artificial and technology miracle is a great miracle, okay?

00:47:01.200 I mean, very, very beneficial.

00:47:05.220 And I've gone through, studied great miracles.

00:47:09.860 The invention of electricity, I mean, wow, imagine where we'd be without that.

00:47:16.020 But if you, anyway, you know, I could describe what the 20s would like and 2000s and like and so on.

00:47:23.360 The ability to convert that to enough of a productivity miracle is not, I think, probable in the, also the time frame that we're dealing with.

00:47:37.820 So this is an issue, the debt is, and that dynamic remains an issue.

00:47:42.780 And then, of course, what there is, is the dynamic of how that prosperity and productivity is shared.

00:47:49.820 In other words, there's the, it creates a great wealth gap.

00:47:55.580 Right.

00:47:55.660 You know, you're seeing, we'll talk about wealth, I'm going to come back and talk about wealth.

00:48:01.780 But you're seeing great increases in wealth on some populations.

00:48:07.660 You know, wow, trillionaire, okay?

00:48:10.540 Yeah.

00:48:10.760 And that kind of thing.

00:48:12.100 And then there's 60% of Americans have below a sixth grade reading level.

00:48:17.700 So that you take that sixth grade.

00:48:19.660 And, okay, now, how are you going, you still have to deal with the nature of that dynamic of how it comes.

00:48:26.100 So the question is, what is the amount of productivity converted into income?

00:48:30.960 How does the government get that income to deal with its debt so the holders of the debt get an effective real return and don't have the problems?

00:48:39.720 How does that happen, you know, in a politically acceptable way?

00:48:43.060 There are lots of things that make that, you know, very, very difficult.

00:48:47.760 I want to say something about wealth and wealth taxes, which is, I think, worth understanding.

00:48:54.700 There's a big difference between wealth and money.

00:48:58.760 And I want to just highlight it, okay?

00:49:04.200 Wealth is very easy to create because it's almost accounting.

00:49:14.560 What I mean by that is I could put out a raise $50 million or individuals can raise $50 million at a billion-dollar valuation.

00:49:28.140 And they will call that that person's a billionaire and that there's a billion dollars more wealth, okay?

00:49:36.320 It's not literally that you have to have those transactions.

00:49:40.700 And wealth is not worth very much unless you convert it to money.

00:49:47.120 In other words, you have all of that wealth, but you can't spend wealth.

00:49:51.240 You can't pay for dinner with it.

00:49:52.500 Right.

00:49:53.000 Right.

00:49:53.940 You have to sell it, sell some of it in order to get money, in order to pay it.

00:49:58.880 And so when wealth rises a lot relative to money, you have a risky situation, okay?

00:50:07.780 Now, the other thing about-

00:50:09.580 Why is that a risky situation?

00:50:11.080 Because when there's a movement, the bubbles pop.

00:50:16.520 Right.

00:50:17.020 When there's a movement that I need to get money.

00:50:20.280 Now, that quite often is I need to get money because it's a debt service payment, you know?

00:50:25.860 Right.

00:50:26.040 In other words, let's say quite often people borrow to buy wealth, okay?

00:50:31.480 So there's a lot of borrowing now, not only in buying stock, but companies themselves buying to create wealth.

00:50:41.240 And when you need to get the money, like in all the stock market bubbles, there was a lot of borrowing to buy the wealth.

00:50:50.180 Well, when the need for money came along, they had to sell some of that wealth to get the money, and then that produces a dynamic.

00:50:59.780 Well, you don't tax wealth, okay?

00:51:02.820 So because you don't tax wealth, and then there is this political issue of wealth.

00:51:09.120 Are you going to tax wealth?

00:51:10.900 What is going to happen in California?

00:51:13.120 What is going to happen elsewhere in terms of taxing wealth?

00:51:16.100 If you tax wealth, then imagine what happens.

00:51:20.420 You have to sell wealth to pay taxes, okay?

00:51:24.900 So there's a dynamic.

00:51:26.680 And that lowers the value of it, right?

00:51:29.340 And that's what pops bubbles. 0.98

00:51:30.980 Right.

00:51:31.260 So the wealth issue is a political issue.

00:51:40.320 The wealth gap issue is a political issue, and it's a market issue, and it's an important issue to understand.

00:51:49.320 Is it inevitable that you would see, given the way our wealth is allocated across 350 million people, that you would get the rise of wealth taxes?

00:52:01.020 Couldn't this have been predicted?

00:52:02.340 It seems like it's such an obvious headline, seemingly logical thing to do, right?

00:52:18.120 Right.

00:52:18.320 In other words, everybody would say, wait a second, all these people are having all the wealth, and they're not paying any taxes on their wealth while this is going on.

00:52:26.820 Okay, we need to go where the money is, right?

00:52:29.620 Right.

00:52:29.780 So it seems like that, without then, you know, the full understanding of those things and how to do it in a, you know, managed way.

00:52:41.300 But so it's, anyway, it's upon us, certainly.

00:52:44.140 And what will happen?

00:52:45.340 I mean, that's, I think, a referendum in California.

00:52:48.560 So if-

00:52:49.100 Well, I think what's happening is, and we're seeing it around the world in many different ways,

00:52:57.540 because people are, people in California are moving, and it's not the it happening, it's the fear of it happening.

00:53:09.740 Right, right.

00:53:10.740 So you're, you know, you're seeing that dynamic.

00:53:14.800 I'm just a, you know, like I'm a mechanic.

00:53:17.200 Of course, I get it.

00:53:18.420 You're not judging another way, you're just describing what's happening.

00:53:20.380 But because that is happening, and people are moving, and not just within the country, but outside the country,

00:53:26.480 do you have any guesses as, or observations about where people are moving?

00:53:31.000 So clearly in the country, it's Texas, Florida, but Wyoming, but in the world, where are people moving?

00:53:37.280 Generally speaking, they're moving to where there's civility and opportunity, and there's not much fighting.

00:53:44.400 You know, they want to be in places that have a, I don't know, they go to places that have lower taxation, but also vibrancy.

00:53:56.960 You know, they go, Texas and Florida, as you say, and here in the Middle East, or in, you know, places that are also vibrant, and things are happening.

00:54:10.060 And so you could see the patterns of those kinds of movements.

00:54:13.480 And then the problems that that creates is a hollowing out in those places, the other places.

00:54:18.960 Because when they leave, the tax base is, you know, roughly speaking, you know, the top 10% pays about 80% of 76% or something of the taxes.

00:54:34.340 And so when you lose, let's say half of them, you lose a big amount of tax revenue, and then that becomes a, you know, a dynamic.

00:54:45.660 Could you see, given all the factors you've described, like democracy, representative democracy continuing in a country like ours?

00:54:54.460 I, you know, I just, I hope so.

00:55:06.080 Oh, me too.

00:55:06.920 I'm not, of course.

00:55:08.060 And I just, and I just don't know.

00:55:10.540 I think, I think we, I think deep in us, we want, most Americans really, really want that.

00:55:21.000 Yes.

00:55:21.180 And so on.

00:55:22.640 And then at the same time, there are unreconcilable differences.

00:55:29.300 And I think it was a recent poll, something like 25% of the population said that they would fight violently for their side.

00:55:40.760 I mean, some significant percentage, yes.

00:55:43.180 And so, and it only takes a relatively small amount.

00:55:48.500 So I don't think we can take it for granted.

00:55:52.020 In other words, there's a lot we can't take for granted.

00:55:54.320 And I think we want to cherish those things, put those things above everything else.

00:56:00.080 But you can't take it for granted.

00:56:02.420 When you hear people speaking lightly of civil war, which they are, what's your reaction?

00:56:07.760 I have a principle.

00:56:12.120 If you worry, you don't have to worry.

00:56:14.740 And if you don't worry, you need to worry.

00:56:17.420 Because if you worry.

00:56:18.420 You're pro-worry.

00:56:19.360 If you worry, then you're more inclined to prevent the thing that you're worried about.

00:56:25.340 So I think that the greater worry about some of these things is a good thing, you know?

00:56:34.520 Yes.

00:56:34.820 In other words, okay, now we won't take it for granted.

00:56:38.060 We worry about these things.

00:56:39.580 So what are we going to do about it?

00:56:41.040 I see people not worrying and sort of blithely throwing it out. 0.92

00:56:44.480 Like, almost like the way they talk about some foreign policy operations is go in and, you know, kill these guys, put these guys in, it'll be fine.

00:56:51.180 And that same attitude I hear a lot about the United States.

00:56:55.060 Like, well, we're going to have to fight it out at some point.

00:56:58.540 You've taken a close look at civil wars throughout history.

00:57:01.580 What are they like?

00:57:03.180 Well, civil wars and international wars are so horrendous that the most bold people who were, you know, trumpets blaring and going into that,

00:57:21.180 and so on, everyone came out of it with deep regret.

00:57:25.360 I mean, we can see while we see it on the news and you can see that, but just imagine how horrendous the wars are.

00:57:37.780 So, I think it's a cycle, you know, your confidence and your boldness is increased by the distance that you have to your last wars, you know?

00:57:52.320 Right.

00:57:54.760 What is the difference?

00:57:56.560 You were saying earlier, there's a difference between money and wealth, and wealth, you said, is not necessarily easily convertible to money.

00:58:11.560 In a society like ours, where is the money?

00:58:13.860 Who has the money?

00:58:14.760 Is it the same people who have the wealth?

00:58:15.960 No, no, no, no, no, no.

00:58:18.780 Many people have a lot of wealth and don't have much money.

00:58:23.540 They have illiquid assets.

00:58:25.640 Yes.

00:58:25.860 Okay?

00:58:27.640 Money is the, is that what you can transact?

00:58:31.800 Currency, short-term deposits that you can assuredly and quickly turn into money.

00:58:38.540 You know, that's what money is.

00:58:40.880 Yes.

00:58:41.140 And, and the central bank really controls the money.

00:58:47.720 And then you could look at who has that increasingly, like you could look at M0, M1, and you could see money market accounts, and you could see those very liquid, you know, money, safe money, treasury bills, those kinds of things.

00:59:04.540 And so that, you know, but ultimately it's the central bank because they control the supply demand.

00:59:12.400 So, I mean, if in a period of volatility, it would seem like the central bank would clamp down on the money supply circulating among people.

00:59:20.620 Well, it faces the trade-off, right?

00:59:23.260 The trade-off is like in, let's say, COVID.

00:59:29.460 Right.

00:59:29.720 Right.

00:59:29.780 Or 1971 when there's too many claims and so on.

00:59:41.360 The trade-off is that people need money, and they may need money to pay debt, and they may need money for whatever reasons.

00:59:52.640 And so they are tempted, therefore, to create money.

00:59:57.600 And so you see the coordination between fiscal policy and monetary policy.

01:00:02.480 So you saw two big waves of large budget deficits and large supports of central banks, first under Trump when the COVID began, and then under Biden when they got in, because he also wanted more universal basic income.

01:00:22.260 In both of those cases, the government sent out lots of checks, and that's also a popular thing to do.

01:00:30.300 Discipline, financial discipline is not what the population typically likes.

01:00:35.300 Send out those checks.

01:00:36.760 But where does the money come from?

01:00:38.640 And then the central bank cooperates by buying the government bonds and print money and then buying those bonds.

01:00:48.660 So when they're in the middle, austerity is not an easy thing to have, right?

01:00:56.740 What happens if the government issues digital currency?

01:01:00.780 What does that mean?

01:01:01.640 Well, digital currency is, right, you're talking about central bank digital currencies.

01:01:08.920 Yeah.

01:01:09.240 Okay, and that there's a great deal of appeal because of the fact that it's easy and so on.

01:01:18.060 But it's, and I think it'll be done.

01:01:22.900 A lot happens.

01:01:23.900 You think it will be done?

01:01:25.580 Yeah, I think it's.

01:01:27.380 And, but what happens in the digital currency, of course, it's easy to transact and so on, almost, and it'll be like money market funds, I think.

01:01:40.220 The question will be first, will they be able to offer interest?

01:01:45.520 So there's a debate now as to whether they will be interest.

01:01:49.320 If they're not able to offer interest, and there will be a debate, probably they won't be.

01:01:55.940 But then they're not an effective vehicle to hold it in because you'll have the depreciation.

01:02:01.620 Of course.

01:02:01.760 You'd rather hold it in a money market fund or a bond, but that's the debate.

01:02:06.260 There will be no privacy, and it's a very effective controlling mechanism by the government.

01:02:12.940 What I mean is all the transactions will be known.

01:02:15.580 All transactions done with digital currencies will be known, which is good for illegal activities, getting control of illegal activities.

01:02:24.300 But it also means that the government has a great deal of control.

01:02:28.000 For example, they can tax that way.

01:02:30.560 They can take your money.

01:02:31.920 They can establish foreign exchange controls and the like.

01:02:35.400 And that'll, so that's something that will be an increasing issue, particularly for international holders of that currency.

01:02:44.300 Because they might feel, let's say, if you're a Frenchman and they wanted to have sanctions, they could take your money.

01:02:52.640 Of course.

01:02:53.000 You know, and so on.

01:02:54.160 So there's the privacy issue of that.

01:02:58.280 And if you're politically disfavored, you could be shut off.

01:03:01.520 Politically disfavored, you could be shut off, yes.

01:03:03.780 So those kinds of issues enter into it.

01:03:08.020 For those reasons, I don't, and they're very tiny, I don't think that you're going to see the development of central bank digital currencies to be of a magnitude that it's going to be, you know, that big of a deal.

01:03:25.340 So I think that doesn't mean it won't grow, but I don't think it's going to be a big deal.

01:03:34.220 So my last question is, given your description of the United States as in stage five in a process that only is six.

01:03:41.940 Which doesn't mean it's inevitable.

01:03:43.460 Of course.

01:03:44.700 But there are only six stages in the process you described.

01:03:47.620 So it's toward the terminus.

01:03:49.640 It's the time that it's time to worry.

01:03:51.960 So you go to Washington, you try to convince policymakers, members of Congress, people, administration, here's what you need to do.

01:03:59.060 You've described the reception you get as like, hey, you don't understand politics, we can't do that.

01:04:03.400 So that's, you know, not a lot of headway made, obviously, for obvious reasons.

01:04:08.220 Do you have advice for people watching who are not policymakers, who are just Americans, as to what they can do to prepare for whatever comes next?

01:04:18.540 Well, you know, there's the basics.

01:04:21.120 You know, well, earn more than you spend.

01:04:28.800 Try to save.

01:04:31.920 Diversify your portfolio, including about money.

01:04:38.760 And those, that's, those things are of paramount importance.

01:04:42.780 Think about the country, the opportunities.

01:04:48.540 Where are the opportunities?

01:04:50.880 People have migrated from one place to another.

01:04:53.700 Follow the opportunities.

01:04:54.520 And most importantly is raise your children well, you know, so that they're well-educated and able to be productive and also civil so that they can be, be effective.

01:05:13.120 And as I say, there are only three things a country needs to do, and that's the same for the individuals.

01:05:18.380 You know, raise your kids well so that they're well-educated and can earn an income.

01:05:24.320 And operate, go to places that work well so that they, there's civility and productivity and there's opportunity.

01:05:33.700 And stay out of civil wars and international wars.

01:05:39.600 Those seem pretty obvious.

01:05:42.700 You do those things well?

01:05:44.320 Well, I mean, really, almost everything else takes care of itself.

01:05:48.220 Really.

01:05:48.820 Yeah.

01:05:50.560 Ray Dalio, thank you very much for that.

01:05:52.420 It's always a pleasure.

01:05:53.360 Thank you.

The Tucker Carlson Show - February 09, 2026

Ray Dalio： How to Survive the Coming Civil War and Plot to Use Debt and CBDCs to Enslave You

Episode Stats

Summary

Transcript