Peak Prosperity - Breaking The Frame

Episode Date: March 29, 2025

The future is going to be very unkind to low context people. Being able to “break the frame” is a vital skill and today we’re going to break one of the most power frames there is: the dollar.Click Here for Part 2

The winners of the future are going to be those who can still concentrate and have the patience to learn and absorb actual context in depth. The losers are going to be people who blindly react and lack any and all context. The following is the audio version of a video released at peakprosperity.com. Visit peakprosperity.com to watch the video and to find other insightful content, such as articles, discussion forums, and exclusive subscriber-only content.

Hello, everyone. I am Dr. Chris Martens, and I'm here with another special scouting report. This one's called Breaking the Frame. This is really important. If you want to survive the future, if you want to thrive in the future, you have to understand what frame you're caught in. Not like these people. So these people here lack all kinds of context and they have the inability to even explain what their positions are. Listen in.

How does boycotting Tesla save democracy? It takes down a leader of the movement to dismantle democracy. What movement? Elon Musk, who happens to be Canadian, raised as well. Okay, so what's the problem with Elon Musk? What movement is he leading? I'm sorry, I'm not here to debate with you, sorry. I'm here to do research on Google. I'm not here to debate you, it just goes on from there. I've played this before during our Signal Hour, so I'm not going to repeat it all here. But this woman asks, I think,

very reasonable questions, the journalist, the interviewer, and nobody's able to provide any context. It's just this assertion. Elon is very bad and they have no context for that. These low context people are going to really get blindsided by the future. And I don't want you to be among them. I don't think you are. But this is this is important. Look, COVID was bad, right? But the economic damage that has been accumulated over the past 54 years, and I'm using a specific number for reason, it's gonna be far worse. When the dam breaks on that, more people are gonna become destitute

and maybe even die from the effects than from COVID by an entire order of magnitude at a minimum. So we have to break the frame. Look, during COVID, right, people who had jobs were separated into two categories. Remember that essential and non essential workers. The essential workers were mainly low level service workers. They were bringing food and door dash to the non essential workers. That is the laptop class, right, who were

actually more important than the essential workers because they were afforded the luxury of staying home during what was described as a deadly pandemic. I'm so sorry, you essential workers. You got to go out and risk your life so these non-essential workers can have their trash picked up and eat food and stuff, right? Of course, it was no such thing as a deadly pandemic but but the message was still received essential meant expendable and non-essential meant those who must be preserved and the list of non-essential office workers was

really quite extensive look at this look at this big old list here, right? So what do we got? Generally speaking here, we got corporate administration, non-emergency legal services, non-essential, right? Creative and media people, consulting professional services, management consultants, accountants, all that stuff, technical, non-critical, real estate, etc. Okay, so generally speaking, these were people who before COVID came into the office, right?

They had office jobs. During COVID, they got to work from home. After COVID, companies had to begin resorting to really draconian tactics to try and force these people back into the office They didn't want to go right you can see all these tons of articles out there like some morale killer They say to return federal to the office say federal workers total morale killer right forced forced to go back Government workers managed to cling to remote work. You can see all the headlines here and many more besides now This is important for a couple of reasons, right?

So what happened? What happened was the old frame, frame of a job requires you to get on a car or train, commute, drive in, traffic jams, work all day in a downtown office, and then reverse that whole thing, commute home. That frame got broken. People suddenly discovered that they hated commuting and they often got more done at home anyway. And together these things maybe offered a better lifestyle and satisfaction and job performance, right? So the frame of work equals commuting, that's just what you do, that got broken.

And once you break a frame, it's really exceptionally difficult to unbreak the frame. Once you find out your partner's cheated on you, you get that as you that like the whole frame of your relationship before then is now irrevocably altered. So this demonstrates something really important here which was that something that was just widely accepted right, it gets reexamined and It's impossible to put that genie back in the bottle once it gets out

So now those holding this context knew to avoid say if you knew that this frame got broken that people weren't going to return to offices and once they understood that they hated commuting And were allowed to live into that new reality once that frame was broken. Well, guess what happened next Well, if you knew this you knew the commercial office space as an investment class was going to get toasted and you were going to dodge the associated Uh commercial mortgage backed or securities or cmBS paper like it was on fire and those without the context got hosed in this story. I mean it's a huge deal like look at this right you know more or less papered over but this is gonna bite hard for a number of years yeah 2025 and beyond right we see that office vacancy

rent pressure fewer workers office demand tanked nationwide vacancy rent pressure, fewer workers, office demand tanked, nationwide vacancy rates of 17.2% in 2021. The CNBS paper I talked about, a huge spike in delinquencies, that's still ongoing. A debt maturity wall with over two trillion in commercial real estate debt matures by 2025. That's all gonna get refinanced, right? And that's at a time when treasure yields went from 1.5% to 4%.

Oops, much more expensive carrying costs now. You got valuation drops, which is a 20% decline in office values by 2025, bank exposures, all of that. Now, this was all predictable by anybody who understood that what was gonna happen when the commuting frame got broken. That's why it's important to understand the frame you're in and when the frame gets broken.

Because you can't convince people now that commuting and going into an office building is a better lifestyle for them, and they're gonna resist it. Now you could force them, and I'm sure some forcing will happen, but at any rate, those who have the right context, they know what the underlying issues are in the drivers.

But it's always more than just the numbers, right? The numbers are just part of it. It's the psychology of it all. It's the frame that people hold, the frame they're operating within. So in this case, it was understanding that people really just don't like commuting. It's a waste of time and life energy. Often it's miserable, it's a traffic jammed experience. The experience the frame though was before covet was oh everybody has to do it. So i'll do it, too Covent suddenly revealed that that wasn't necessarily true and that genie is not going back into the bottle

So there's a bigger frame than this even that's breaking right now, right? And um, and it's just just and by the way, look at this. This is the office CMBS delinquency rate. Like we are back at least for that class of real estate commercial mortgage backed securities that are related to office space. We're at the same default rate that we saw at the height or depths, depending on how you look at it, of the great financial crisis. So that's pretty serious, right? So obviously understanding the frame of things is

important. Now just as the vast bulk of people, right, myself among them during the time I was a commuting worker, and I was for a number of years, never questioned or thought to challenge the idea of commuting to work in an office building with very few people, especially not even myself, right, had questioned the core premises up to this point of the dollar and investing. So I want to look at that because this is the frame that's about to break. Now the frame right now of investing is entirely constrained for all of us because we live in an airtight dollar universe where the one and only rule is and you understand this because you live in this frame

You have to invest with an eye to the idea that dollars lose their value over time We call that inflation But it's more accurately described as the dollar losing value because that's the actual process, right? Now I described this in great detail in the crash course, but here's a quick review. Suppose you have an orange, you know, that you could eat an orange, you've got a house in an ounce of gold, and those cost you respectively, let's say $1, $300,000 for the house and $3,000 for an ounce of gold. But in five years, you suddenly discover, you wake up, clock down the head, rip van winkle, you wake up, you discover that the orange, which magically hasn't rotted, is now $5.

Your house is $1.2 million and gold is now fifteen thousand dollars. Wow! With a dollar frame of reference you might think, wow you picked wisely, you've gotten rich, right? You're now worth five times as much as before, right? Assuming, you know, your orange again didn't rot away. But, but, are you any, are you actually any richer than before? Because in fact if you think about it, you're in exactly the same position as before because the orange is still an orange. It has exactly one orange's worth of utility. The house, same thing, it's still a house, provides exactly one house worths of utility,

same as five years ago. And absolutely nothing happened to the gold ounce because gold's atomic and molecular character is immutable. You can take a gold coin and sink it in the ocean, which is one of the most corrosive substances I know about as a boater, and a thousand years later, it's still exactly how the condition it went down in before. Nothing happened to it. All right, further, let's think this through further. The relationship between each of those items, right,

between the orange, the house, and the ounce of gold, it's unchanged from a ratio standpoint. It takes exactly the same number of each of them to buy the others this year as it was five years ago. What has changed though is the number of dollars it takes to buy each one. That is, it's the measuring stick, the dollar that's changing, not the thing being measured. Now that makes it a very poor measuring stick the dollar that's changing not the thing being measured Now that makes it a very poor measuring stick, right? You want your measuring sticks to kind of be uniform and that's one of the characteristics that money is supposed to have so we don't

Actually have money the dollar is not money. It's currency Mike Maloney of goldsilver.com Makes that point all the time, his hidden secrets of money makes that point. What we call money is currency. And we have to call it currency because it violates one of the core precepts of money, which is that it shouldn't, the yardstick can't constantly be changing its length, mostly shorter, right? You know what?

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So sign up now at peak.fan slash gold core to secure your 6 months of free storage. So sign up now at peak.fan.goldcore to secure your six months of free storage. Again, that's peak.fan.goldcore. Now this might seem esoteric, but it's not. It's really not. It's the true frame and it's been true for millennia. Here's a short example in 1929 10 kilograms of gold cost $6,600 and the median price of a home was 4902 dollars and in 2024 10 kilograms of gold was 756,000 the median price of a home was three thousand three hundred eighty four thousand five hundred so it turns out That exactly the same number of kilos of gold that you needed in 1929 to buy a house is the same as today

Huh, would you look at that? Hmm even though a house was forty nine hundred dollars announced three hundred eighty four thousand our measuring stick just and now it's 384,000, our measuring stick just shrank like crazy. But the thing that you actually care about, gold, houses, food, cars, all of that, none of that changed. None of that changed. So it's the dollar that's changing. Now, as I pointed out as well in the original crash course in 2008, in Roman times it took the equivalent of about a troy ounce of gold to buy a really fine toga

And today it takes about an ounce of gold to buy a really nice suit, right? The more things change the more they stay the same, right? Okay. Now I'm gonna go in part two for my subscribers really important I'm gonna talk about all of this is leading up once we break the frame It's leading up to this conclusion that I believe that if you look at things from a certain perspective my perspective macro perspective the Fed is gonna have to print again that next move that the Fed's gonna undertake that by Fed I mean Federal Reserve it's gonna be bad for you and gold is telling us the tail but to get there we need context and to tell

that tail I'm gonna have to rewind to 1944 take us through 1971 take us through 1968 take us through 1996 through 2001 I'm there's some some elements here we have to tell that's what this whole story is gonna be about when I get into part two now now so I haven't quite gotten to the frame that that really needs breaking right okay sure Okay, sure. I get it. It can be a real mind bender to discover that it's your measuring stick that's changing, not the things being measured. That takes time.

I get it. But even that, that's less of a challenge than understanding the intense marketing we've all undergone from Wall Street, mainstream media, the need to invest. You're a smart person if you invest smart investors you have to invest but they don't mean invest they actually mean speculate and the reason you have to invest or speculate implied and almost never

explicitly stated is because inflation is going to destroy the value of your savings and nobody really has to say it because you already know it, right? You know it from your lived life experience. That's just how things are, like commuting to work. It's just a fact of life, something we all know. So you just live with it, right?

But is it? Is the choice between, really between losing the purchasing power of my money if I save it or placing it at risk to try and grow it faster than the rate of inflation, what we call investing, right? It's just handing it over to Wall Street, closing our eyes, crossing our fingers, hoping for the best, right? Okay.

This gold example here suggests there's actually a third option, again, rarely talked about. You can simply maybe put your savings into gold and it won't make you rich, right? You still need the same number of kilos of gold to buy a house or a toga, but but it will keep pace with inflation now Surprising to many people perhaps is this chart is the fact that this entire Millennium gold actually was a better the fact that this entire millennium gold actually was a better investment than the US stock market. This is from Bloomberg. If you had bought one unit of gold in one unit of the stock market on March 31st 2000, you carry that forward to today. You find out that the gold has gone up a little over a thousand percent

and the S&P is a little about four hundred eighty percent gold's done a lot better than stocks. No fuss. No muss No risk, especially not the risk from the great taking which is something that another other things We'll talk about later. Okay So my readers are also gonna appreciate that the gold did this Without any of the raccoon risks associated with Wall Street in particular that physical gold again in your hot little hands zero risk From being appropriated by those who installed and operate the great taking machinery which you need to know about Which is both a significant and I dare I say underappreciated risk by almost everybody and again context is everything once

You know these things you can make appropriate choices. That's why the mainstream media, that's why the powers of B want us to have no context. That's why when there are revolutions the first thing the communists, the authoritarians, the socialists do is they tear down the statues. They don't want you grounded in your past. They ruin the libraries. They get rid of the Christians. They basically upend and tear out all the history books and rewrite them because of people without Context are people that are easily manipulated So that's why it's super important. We understand this kind of context now

The story that we've all come to accept usually without questioning or context is that inflation? Simply a fact of life. It's just how things are Chris. Come on grow up inflation that inflation simply a fact of life. It's just how things are. Chris, come on, grow up. It's inflation. It's a fact of life. Get used to it. And because of that, you know, you got to take risks in the stock market to offset that, right? Yeah, you got to keep swimming. But I'm gonna have to stress something here, which is that persistent inflation is both it's a modern invention and inflation is both it's a modern invention and Is a function of the intense

mismanagement of our fiat money system by the Federal Reserve Washington DC all with the enabling assistance of bankers and Wall Street consider this if you will look at this chart here In this chart you can see that prior to World War two Prices sometimes went up which is, and sometimes went down, which is blue. So sometimes we had inflation, that's red. Sometimes we had deflation, that's blue. That's up until World War II, and then ever since then, it has been nothing but up. It's red, just red, red, red, red, red, red, red,

all through this period here. By the way, this chart, I got this out of the Wall Street Journal, so if you wanna know know yeah it says so up there but this is this is just monetary history okay well until world war two this system and uh you know that we all knew and love right or hate right was put in place the one you live in and ever since then prices have only ever gone up which is that the value of the dollar our national international measuring stick has just gotten shorter and shorter and shorter it's gone down down down down down now this is a little hard to interpret because you have to mentally

sort of adjust sometimes prices go up sometimes they go down what does that look like if we just put that on a chart and it looks like this. Now you can see we start way back here. Let's see, between, let's call this the founding of the country back here, 1775 we had this little revolutionary war, prices went up but then they came back down again, there was another little skirmish here, we had the war of 1812 and then prices came all the way back down again from 1775 to 1850 we had exactly zero inflation that is for those 75 years you could have earned money put it in a bank taking it out and if a house was 4600 bucks at the beginning of that it was

4600 bucks at the end of that period if a suit of clothes Was an ounce of gold at the beginning of the period it was an ounce of gold at the end of the period. If you, whatever you did it was like, oh but then we got the civil war. This was punishing inflation. People hated it but then it came all the way back down again. So that we can say by the time the Federal Reserve was created in 1913 the country had experienced from start to finish exactly zero cumulative inflation. That's because sometimes it went red, sometimes it went blue, it bounced up, it bounced down, but from 1775 to let's call it 1910, absolutely nothing happened.

A dollar was a dollar and off we went. Okay. Now, sure. Yeah, there were, you know, brief periods of excess there and those spending in the wars got that But after those wars were over if they concluded prices went back down now why? That's because we were on technically a silver standard with gold Then placed as a fixed reference to silver. So the silver dollar was I think 371 and Some odd grains of silver. No more, no less.

It's just crisply defined, right? Now the reason that prices went back down here after going up during these wars, well, we already discussed it. Because a house is a house and orange is an orange, a suit of clothes is a suit of clothes, and an ounce of gold and an ounce of silver all still had exactly the same relationship to each other before the war as after the war. Now before the Federal Reserve came along you didn't have to invest to avoid losing your savings. You didn't have to. You simply worked and whatever surplus you had you bought gold and silver and that was that.

Now if you wanted to invest, if you wanted to speculate, if you wanted to place your capital at risk, that was a separate decision to make. And you could make that, and many people did. It's how our country got ahead, right? Now, that one usually carried the usual relationship between return and risk. But nobody was forcing you to invest. In this period of time, there's no forcing function. This is a forcing function.

You have to invest. There's no alternative, right? And that's absolutely the case if you're, say, in a company matched 401K plan that only has access to, say, a limited universe of Wall Street-operated, long-only stock and bond funds, right? Well, you're thinking, yeah, but it's okay, Chris, but look, this is a long, like this

inflationary experience, that's level territory, that's level horizon to you and me. That's where we grew up. That's just how the world works. But I'm telling you, that's not how the world works. That's how it's recently worked. And it's only done so because of some heroic activity to suppress the canaries in the cold mine. And that's gold, that's silver mine and that's gold that's silver

and that's what we're gonna talk about when this all breaks that's what part two is coming up on this all right but you say you know inflation you just have to inflate you have to invest for inflation that's just what everybody does so I do it too well now that frame is breaking right and more and more people are getting the clue and I'm receiving calls from people now. I know for these light bulbs are now going off Right Chris. What was that stuff? You've been talking about all these years, right? Listen as with commuting though once that frame is broken It's ridiculously hard to get back to the original frame once you understand that the dollar has been this horribly

mismanaged and that there has to be a relationship between the amount of dollars produced and the underlying economy which is the things that the dollars only have usefulness for because you have to buy things with them a Dollar is supposed to be a store of value And it's not okay And so it gets ridiculously hard to return to that original frame as I, is the proverbial red pill moment from which there is no return. And there's nothing more important to your financial future than knowing where this ship is actually headed.

In order to know that you have to understand how we got here in the first place. So in part two for my subscribers, we're gonna dive into my Mac review of how and why exactly this dollar system is gonna have to be sacrificed by the Federal Reserve in order to preserve the bond market and Why the Fed is gonna have to begin printing money again by the buckets more than ever before and this time It's gonna really hurt and how all of this inescapably leads back to hard assets Now if you're not a subscriber peakity, I wish you the best of luck. I strongly encourage you to become as resilient as you possibly can. But for the people who are subscribers, this is a big one.

And as you know, we've been on a big tear this year, putting together big giant pieces of information about the impact of AI, which is one whole thing we had to consider, about the impact of how people make decisions and how those low context people even came to be and why I think it's not organic. There's people pushing buttons in this story, understanding that we may be under enemy attack as a nation by people who want to destroy it, and there's no sure way to completely ruin a country than to ruin its system of money. And our system of money is on the path to ruin. And I don't want you to be on that same path.

There's a way off of that path. I've shown you some of it. Now I'm going to build the rest of the case. For all of you who are peak prosperity subscribers, follow me back. We'll have the rest of the tale there. For everybody else, thank you for listening and have a great weekend. Bye for now.