The Pomp Podcast - #1468 Dave Collum | Financial Disaster Is On The Horizon?!

Episode Date: January 13, 2025

Dave Callum is a Professor of Chemistry at Cornell University. In this conversation we discuss his 2024 year in review, bitcoin, gold, stock valuations, frontier justice, cancel culture, Elon Musk, government spending, healthcare administrations, and much more. ========================= Ledger has been trusted for 10 years to secure 20% of the world’s digital assets. Their latest devices, Ledger Stax and Ledger Flex, feature secure touchscreens for safer, easier crypto management.Go to ledgerpomp.com to take control of your digital future ======================= Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. Protect your loved ones with sound money built to manage life’s uncertainty and a broken financial system. Their BTC-denominated Whole Life Insurance policies allow HODLers to pass more BTC on to their loved ones and a tax-advantaged way to access BTC for liquidity during their lifetime. Visit their website at https://meanwhile.bm/ to join the waitlist for a policy and to learn more. ======================= This episode is brought to you by Bitdeer (NASDAQ: BTDR), a global leader in Bitcoin mining and high-performance computing for AI. Led by a seasoned management team, Bitdeer is driving innovation with its proprietary SEALMINER ASICs for Bitcoin mining and has a massive 2.5 GW power portfolio across three continents. Learn more about Bitdeer at www.bitdeer.com ======================= Pomp writes a daily letter to over 265,000+ investors about business, technology, and finance. He breaks down complex topics into easy-to-understand language while sharing opinions on various aspects of each industry. You can subscribe at https://pomp.substack.com/ ======================= View 10k+ open startup jobs: ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠https://dreamstartupjob.com/⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ Enroll in my Crypto Academy: https://www.thecryptoacademy.io/

What's up everyone? This is Anthony Pompliano. Many of you know me as Pomp. You're listening to the Pomp Podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. What's going on, guys? Today, I've got an amazing episode with Dave Collum. Dave is a professor of chemistry at Cornell University, and he writes a absolute mammoth document at the end

of every year. He calls it the Year in Review. The 2024 Year in Review is almost 250 pages, and it dives into all the things that Dave saw this year, what he's thinking, and where he thinks the world is going. In this conversation alone, we talk about Bitcoin, gold, stock valuations, frontier justice, cancel culture. We talk about Western Spring, Elon Musk, government spending, healthcare administrations. We talk about the merits of price gouging, the RFKs, True Plant, the Baltimore Bridge, creative destruction, portfolio breakdown, and much more. This covered as much content as I have covered in two hours in a very long time. I'm excited for you to listen to the conversation. And I promise you that if you listen to the whole thing, you're going to

come away thinking more independently, more critically, and you're going to have a lot more questions than you do answers, which is the whole point of consuming great content on the internet. So here's my latest conversation with Dave Collin. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

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enhancing your digital security. Go to LedgerPomp.com to take control of your digital future. That's LedgerPomp.com. L-E-D-G-E-R-Pomp.com. Today's episode is brought to you by Meanwhile. Meanwhile is the world's first licensed and regulated life insurance company built for the Bitcoin economy. Operating on the Bitcoin standard, they do everything in Bitcoin. You pay in Bitcoin. They pay claims to your family in Bitcoin. You take out policy loans entirely in Bitcoin when you need liquidity. Meanwhile, Bitcoin life insurance has redefined what it means to hodl. Protect your family from life's uncertainty and a broken financial system. Build intergenerational Bitcoin wealth while the cost of living skyrockets in dollar terms. Get all the tax and legal

benefits of life insurance now in Bitcoin. They are actively binding policies today. Whether you are a long-term Bitcoiner or are just considering it for the first time, a Bitcoin whole life policy could make sense for your wealth plan. Visit their website, meanwhile.bm, to join the waitlist and to learn more about the world's first Bitcoin life insurer. Again, that's meanwhile.bm. Go check them out today. Today's episode is brought to you by NASDAQ-listed Bitdeer. They trade under the stock ticker BTDR. They're led by a seasoned management team. Bitdeer is a global leader in Bitcoin mining and high-performance computing for artificial intelligence, and they are backed by technological innovation and a massive 2.5 gigawatt global power portfolio recently bitdeer

launched its own bitcoin mining asics named the seal miner to target what wall street analysts project to be a multi-billion dollar annual market their proprietary seal miner asics are redefining efficiency and performance and they are backed by the industry's most advanced chip roadmap with two more groundbreaking models set to launch in 2025 to learn more about bitdeer's cutting edge technology in business, visit their website at bitdeer.com. That's B-I-T-D-E-E-R.com. Go check out BitDeer today. All right, Dave, I thought a great place to start this conversation is everyone is just super excited. They're exuberant. There's euphoria in the market when it comes to stocks and various asset prices. And I think that the folks who've been around for a

while, they say, wait a minute, a market crashes around the corner. There's no way that PE multiples can be this high. Everyone is way too exuberant. The MAG-7 is overvalued. A crash is coming. But the question I have is, do you think that the Federal Reserve broke the market and has outlawed or banned these market downturns and recessions? Well, I think they broke the market, but I don't think they've outlawed recessions and equity corrections. So yeah, they broke the market. Here, I've been thinking a lot about this. The fact that private equity can rape and pillage means monetary policy is too loose that it's too loose because that should not be profitable destroying companies should not well so so they go they buy a company they sell off assets they

they take on huge debt they pay themselves huge huge bonuses and they sell off the company with a 47 probability those companies go bankrupt that's in another book for you we always swap books don't uh next book for you is um is uh the plunderers by gretchen morgans and josh roger i'm sure you've read it i can see who's working um so so when it's profitable to destroy companies the money's too loose when my dad was when i was young he went into a new business he was a contractor he went into some subset of that i asked him why and he said you mean besides i can make money i said yeah why that one he said because it's got a big capital outlay and and anyone who has the quantity of capital needed to do this business i can compete with if the if i

what i can't do is compete with a guy who can get in on a dime undercut my prices put us both out of business so the so so limited access to capital is a moat for good businessmen and private equity guys should be hung from their their chads i now call them chads in an election season hung by their chads until that and some some private equity guy called me you get you get spam calls all the time sell your shit all the time okay so i've i've now taken answering an unknown number i say my my answer is i pick up the phone i instead of saying hello i say if you're trying to sell me if you're trying to sell me an investment product, I'm going to hunt you down like a mad dog.

Is that legal? And then there's some private equity guy. I don't know. You mean hunting them down? Yeah. No. The other thing I'm thinking of switching over that we're going to have a lot of phone sex.

You think so? I've thought about that. I have wanted to get a call from someone and start having phone sex with them. Say, can I fondle myself while we talk? You know, and just take it from there. Are you hoping it's a private equity guy? well if it is the problem is they'll like it um all right what about stocks hold on let's talk

about the stocks though right because the private equity they're doing this the you think that capital is too cheap while they're doing uh or able to do this um obviously cheap capital pushes stock prices higher one of the things that i find interesting is uh p ratios are definitely up um i think that i saw uh we are somewhere in the ballpark of uh 28 i think um and yeah i don't buy those numbers at all okay by those numbers at all explain that one second but the uh the thing that i also saw is that the free cash flow margin for the largest publicly traded companies in the u.s is up like 500 since 1970 so it's been increasing the businesses have been getting better more capital efficient that they're uh kind of more attractive from the way that they operate the

free cash flow that they're able to drive the question i guess is how do you start to uh look at hey these businesses are better than they used to be but the multiples are up like the historical comparison to me the historical comparisons become harder when you have better businesses today than you did then i don't think they're better businesses let's start let's start with facebook if facebook died today who cares true but well first of all i think i think a lot of people would care how many billion is that i think a lot of people would care uh but more importantly is they're driving a lot of profit, and they do it in a more capital-efficient way. There's a great plot that gets mis-presented. There's a plot that shows capital-intensive

businesses and how they perform in the markets and capital-unintensive businesses and how they perform in the market. And as you just said, the capital-unintensive businesses have soared. The capital-intensive businesses have done nothing. What that means is the guys who are blocking and tackling and creating wealth, aka Robert Gordon, as we talk about every podcast, are getting the crap kicked out because it's very expensive to actually create wealth. The capital-unintensive business is where you're slopping pixels around, you're slopping money around, you're slopping stuff around that really creates no wealth whatsoever. And maybe my definition of wealth is wrong, but the fact of the matter is, is there anyone listening to this

podcast who really is enjoying the fact that they have to always reset their password, always log in and always have to do everything and download a fucking app every fucking time you want to do something and it tells you your password it's not the right password you know it's your right password and then you go to do something i spent i tried it i tried to renew my passport to 11 attempts to upload the photo and then and i find guys i call they i go down to cvs you got to take it from there they they give me a photo and then i upload it successful now i still can't get to the finish and my it guy walks in i'm having to figure out why my printer is printing double side when the box is checked to print single side he doesn't know but he defaults and everything and

gets rid of it right so this is the annoying world we live in so then i said well by the way i can get my passport he says i got mine in a week and and and i booted up and i'm doing and he starts doing his phone thing he says you're not at a government website you're uploading somewhere else i don't think yeah i want to find a person who did that and beat him with a bag of oranges i i just want i want to get even with that guy i want to get that i want frontier justice to come back all right so this is a big thing i'm ready to hit a bell tower this is a big theme uh you do a year in review every year i enjoy reading it i know many other people enjoy reading it This, just for those that are watching, is only part one.

This is a fat one. I thought I was going to run out of ink in the printer if I printed the whole damn thing. If we go into that year in review, at one point you talk about the island of snakes, I think it is, right? There's a bunch of snakes on the island. Snake island. Snake island. And you want to take a bunch of people who have done really bad things to society and put them there and say, we'll see you later. Right.

Explain frontier justice and why you think bringing that back potentially could have a positive impact. Well, so I've been thinking about this. We were watching a TV show from 1720 Hudson Bay. The show was not made then. That's what it was about. And some guy was a total dick. And I realized this is not realistic. Because in 1720, some outpost in Hudson Bay, if a guy's a dick, someone's going to take him out.

He's going to turn the corner. No one's going to be looking and he's going to be clubbed over the head. Right? And so you have to learn how to not piss off people or you did not survive. So that's the social animal. We don't have that consequence anymore. And so like, look at the squatter story, right? You can't get rid of the squatters.

What I would like to do is go into the squatters with the Louisville slugger and smack them a few times and say, if I ever see you in this neighborhood, you are going to die. That's what I want to do at this point. I've just had enough of this kind of bullshit. If Mershon tries to throw Trump in jail, dox the guy, right? Post his fucking address. I've just had enough of this stuff. I was listening to the sentencing. My guess is they won't sentence him to anything, so that'll come to nothing.

But I'm growing so tired. I was thinking about I got canceled in 2020. I was thinking about that coming into work today for some reason. And what I posted was a post to QTR where I defended the police. I said, look, I don't know why the guy was in that. It was a war zone. And he shouldn't have been there. He's an old man. It's the guy who got pushed over in Buffalo. I remember. And I said, yeah, right. And I says, it's kind of self-inflicted when you're poking riot police. And he actually turns out he was skimming their equipment. He had been a pain in the ass all week. And it turns out he was a grifter. But I didn't know that at the time. I just saw an old guy being stupid. And I said, it's kind of self-inflicted. And next thing I know, the entire fucking Cornell campus wants to get me fired. Now, I just shut up. I had trustees calling me, chatting with me. David Einhorn reached out.

We spent hours on the phone. My brother-in-law was a trustee. We spent hours on the phone. And so I had big backers, but it was an unpleasant experience. The next time I'll come out swinging, the next time I'm going to write an op-ed and say you fucking pussies you spent seventy thousand dollars to pay my fucking salary and this is all you got right so so um do you think i'm kind of looking for fights now do you think that public discourse has changed obviously with trump uh winning the popular vote there's been a kind of

a vibe shift in america um but i also think who used that phrase someone invented that shit who invented that phrase vibe shift i don't know but it's perfect no someone there was one person who came up with it it was a prominent person i remember thinking that's a good way to describe it yeah i think it's perfect so uh what i do think though is america is also fed up with the cancel culture for the most part right when uh when you see the hit piece people don't even read of it anymore they're like ah shut up uh when you see uh someone trying to go and get somebody canceled um people like ah shut up except i do think one of the risks are uh the left extreme has been the cancelers for a while. But now there seems to be a faction of the right that is starting to

use some of the same thing. And so I wonder how much a cancel culture is not left or right, but just who's in power. Well, that's an interesting point. That really isn't it. In fact, one of the things I've labored over is when Trump gets into power officially and he's got his A-team, which I really like the looks of, including people who others are appalled by, like Rubio, right? I totally understand why Rubio is not a popular pick. What I've encouraged people to consider, and this is in part two, by the way, is assume that Trump and his inner circle vetted Rubio pretty carefully and asked the question, why did he pick Rubio, right? Because he's not obvious. And I think my guess is if I had to write a plot, I'd say, look,

this is what we're going to do, is what we expect out of you. If you can't do it, I'm going to fire you in a heartbeat. Don't take the job if you can't do it. What do you say? And Rubio's a chameleon probably, right? So he said, yeah, I can do that. So the question is, do I want to see Trump go out there and move the country forward? And do I want to see him exact some revenge? And I think the constructive thing is to move the country forward. But I've had a lot of podcast hosts, when I ask them, they say, we've got to clean up some of the mess that was created, though. We can't just let this go. And so as you read in there, my 23 and me traced me back to an inbred tribe in the Neander Valley, which means I'm a Neanderthal. And so I would love to see

some of these douchebags get what's coming but it will be distracting and if he really wants to get something done um he's gonna have to stay focused all right before we get into some torn yeah before we get into new administration and things that they're going to do let's cover a couple things uh on the economy uh first gold outperformed the smp i think it's the first time in history where gold and the S&P are both up more than 25%. And I think that there's a lot of people who look and say the S&P performance over the last two years is unsustainable. How do you reckon with gold and the S&P doing so well,

gold outperforming the S&P, and then two straight years of 20-25% performance of S&P? Well, if you go back to the Buffett's 1999 Fortune article, he lays out in luridly clear detail. I've read it probably six times. And he says what dictates the performance of the markets in a long term is what is happening to the long interest rates. And he says, it's not about GDP. It's not about wars. It's not about pandemics. By the way, in 2009, I said pandemics and wars don't have an effect on markets. Boy, that was kind of foreshadowing wasn't it um and um and he says it's about the direction of interest rates long-term

rates and he said from 1967 to 81 when the markets were uh inflation corrected went down 75 which which in 75 is bad 14 years is worse right 14 years is a third of your investment life and so if if you spend 14 years climbing down into the valley of death you've just burned a lot of time duration is what you guys like to call it and so and then he said the gdp during that period was better than the gdp from 81 to 99 but from 81 to 99 interest rates went from way the fuck up there to down and he says that's why the markets did well so what what happened? Well, from 81 to the present, interest rates went from, or recent years, interest rates went from 17 to zero. It's almost as though they were smart enough to know, they said, we've got

70%. We can squeeze four decades of gains if we bleed the 17% down to zero, almost like they knew what Buffett was saying. I doubt they did, but almost like they did. And now we're at the bottom. Now, nitwits on Wall Street, which I repeat myself, like to say that low interest rates are bullish because you say, well, if you can't get it in the bonds, you got to buy the stocks, right? That sort of thing. No, low interest rates are bearish unless you got the attention span of a fruit fly because now you're at the end of the rope. You've run out of slack. You now have one direction so in a secular investing world low interest rates are the game's over now and and if we have turned the corner in a these very long wavelength credit cycles it's not necessarily

going to go to 17 again but it might given all the debt and everything um if we've turned the corner as a lot of gosh smart guys think we're looking at a very bad bad couple of decades for equities. And you can say they're not going to correct. What I like to ask people rhetorically is, so I think we're 200% over fair value, historical average value. And I can show you 25 metrics that sort of support that. The simplest one is to take the case Shiller, you 1880 to 2025 if you set as a baseline the average from 1880 to 1990 it just channels just like channeling stocks.com right and um and it averages around 12 when it was cheap in 81 it was six good place to start a bull market in fact i don't think we needed reagan it was going to start

no matter who got elected um and uh and and so that sets your baseline at 12 it's 38 now right so what happens if we regress back to the mean we got to drop 70 now people say oh that would never happen right um okay to those who say that i'll ask the following question name for me an asset class that got way overvalued that didn't find its way back to cheap they don't exist it's a truism they can't exist it might take a while how long does it stay quote-unquote overvalued until you say it's a new regime is that a 10 years 20 years 30 years like what is nothing nothing here so so i also as you know i went through the consequence of being overvalued so valuation let's say any valuation metric is the price divided by something it ought

to track and what's really critical, they're both inflation sensitive. So inflation doesn't get you out of overvaluation at all. So you inflate the price, you inflate the earnings, they both track inflation. Therefore, we can be 200% over fair value. Fair values should be historical average value. And you can inflate your ass off and you're still 200% over average value. It doesn't get you out of that mess so um if you have a stock like the example i really like was when we came out of the dot com buffett said that he he actually regretted hanging on to coca-cola we know how much he loves that stock and the reason was because because at the end of the 90s coke got up around a pe of 50 now coke at a pe of 50 means it has a two percent cash flow and he could get five and a

half percent out of a 10-year bond why would you own coke at two percent cash flow when a bond will give you five and a half percent you say well the price might go yeah and then the price will go back down you say okay let's say coke doubles its earnings what if pop in the next 20 years where the odds coke's gonna double its earnings zero right why why zero it's basically a royalty trust. Coke's going to double its... It could double its earnings by acquisition, but that's not legit doubling earnings because acquisitions cost money. So you're just expanding the size of the footprint. You're not actually doubling your earnings. WorldCom did that. How'd that work out for investors, right? So let's say they double their earnings. Now they're priced. So that's

almost impossible to imagine buffett should have known this is what he said now they would be priced to return four percent right you can't get out of that your overvaluation is a dead end so if you own a company that has a p of of a hundred and and you somehow think you're going to grow your way out so your price return one percent say well i'm going to double the earnings because it's a growth company. It's bullshit.com, whatever. So you double your earnings. You're now price return 2%.

And if you say, well, I'll double them again. Well, it's price return 4%. Double them again, price return 8%. How long is the market going to wait for it to return 8%? Not long. What's interesting is there's this chart that just came out of Uber's operating profit.

And for years, they're heavy, heavy losses. The losses start to subside. They get to break even. And then the chart just continues. And there's just very methodical growth. And now they're profitable from an operating profit metric. What's interesting to me about that is, and I tweeted this saying, this is a classic playbook from a venture capital standpoint. That's what the venture capitalists want to see, right?

They want to fund tons of losses for years and years. And then eventually you flip it, it becomes profitable. And then it prints money. They made a bunch of money. They're happy, etc. We talked about private equity investors earlier. The tech industry has now been doing this for decades, but really in the last, call it, 15 or 20 years, there has been a substantial amount of capital that's been put into that market. These companies are starting to come public over the last five years or so.

There's been a lot of critics who have come out and said, hey, I actually don't like these companies. We think that these companies are bad businesses. They're just surviving because of the venture capital. They're overvalued. Name your critique that people have thrown at them. How do you think about those types of companies, which definitely fall in that growth category? Some of them do seem to be reaching a point now, Palantir, Uber, et cetera, where they're becoming attractive businesses. Oh, Palantir is such a hot button.

I'm staying off that one. There is no question there are companies who are going to scrape up a lot of profits. Again, back to the Buffett article. He says, when you take the market, I don't know how to pick the Palantirs. I don't know how to pick the Ubers. right? By example, how many companies exist that still call themselves .com? You say, I invest in Amazon. You can say, I don't say amazon.com. It has a .com on the end because that's their website. How many companies are still .com? The answer is none, right? There

were a ton of them that went to shit. And so you can focus on Amazon and say, oh, they did really well, okay, there's one example. But at the expense of vast numbers of other companies that are no longer with us, and if you are an indexer, you own those too. And the question is, is the world really a better place that now everything has to be purchased online? And I don't think it is. I think Amazon's business model might be to wipe out absolutely every last brick and mortar and then build brick and mortar. I think, I think they're, they're already doing it to a degree, right? They're already doing it somewhat in terms of obviously they've got the

grocery stores and, and there's a number of businesses, especially a lot of D to C clothing companies, right? They kind of, everything's online, everything's on, everything's online. And all of a sudden they start opening up physical stores. So that makes sense. If we look at the mag seven, there's this great chart that shows about 2008, 2009, There becomes this bifurcation or separation in the market. And pretty much since 08, 09 until today, the mag seven has just been on an absolute

domination, you know, trend. They are destroying the rest of the S&P. Why do you think that's happening? And is that a sign that the world is shifting to this kind of capital light digital first type company? Or is that something where there is this, you know, amazing crash on the horizon that people don't really see? Well, so I'm not a believer that crashes repair damage. So I do not believe that, you know, what's the best example of crash?

1929, but it wasn't the 29 crash that did the damage. The best example is 87. That was a blink of an eye, right? A blink of an eye. it. So if we had a crash of 50% tomorrow, that would be a headline moment. The dip buyers would show up. Next thing you know, there'd be headlines saying, if you just held on, you'd be in the black by two years from now, right? Never, never, never, never sell. What I'm saying is, is if you listen to Buffett, and I'm not a Buffett fan. I think he's a fucking hoser,

but he's a brilliant hoser. And what he said in that article, by the way, is the most you can hope to get out of equities overall after all the fees and everything that you can't see and he wasn't clear about the what you can't see he says there's so many things you can't see he said the most you can hope to get is four percent real guy named ron grice looks at the s&p from 1925 to the present and corrects for inflation using m2 seems like a clean way to do it. I think we've probably talked about this in the past. He gets 3.79% total return, correcting for M2. Capital gains, he gets a loss from 1925 to the present, correcting for M2. So hedging inflation, equities work fine as long as inflation's not nuts, right? So the analogy I like

is shovels and bulldozers move dirt, equities, and gold hedge inflation. Don't pick the wrong tool for the job, right? And so when you need to move a little dirt, you use a shovel, you use equities, whatever. When inflation gets bad, the equities will make you suffer badly. And so right now, there's not a guy sitting on Wall Street right now who knows what a bad market looks like. we've been in a we've been in a 45 year bull market we've been in a 45 year you know the pitch here it is again this is a repeat by the third time and 81 pe was six interest rates for 16 or 17 the russians sold us resource started selling resources for pennies the chinese sold slave labor and the boomers hit the market with their wives so the demographics were phenomenal

from 81 to the present valuations which should not trend unless you're willing to say the cash return on them is trending the other way because if you're sitting at a valuation of 30 you're getting three percent return there's no way around that that's that's what it's got to give you can't get more money out of the system than what you create and and the valuations which should not trend compounded four percent a year for four decades when that reverses duck okay let me play devil's advocate and really not even devil's advocate as much as i actually believe what i'm about to say 2008 2009 ben bernacki and the rest of the crew they come up with the genius plan to literally press a button and create money you don't believe the genius part uh and then you

They put that money into a select few banks or financial institutions, bank accounts, and let them go buy assets in the market. This idea of creating money and creating lots of money, first it was hundreds of billions, now it's trillions of dollars at a time, took them 15 years or so to perfect the playbook. COVID happens, and they are sitting there saying, put me in, coach. i've been i've been practicing i've been practicing i'm good i'm ready to go give me some game time yeah i blame them i actually i put i put that on them 100 yes let me get up to bat coach coach puts them up and they hit a grand slam first at bat they slammed trillions of dollars they got the politicians uh printing money as well they got interest rates down the emergency cut i mean just you couldn't draw it up better they hit a grand slam market v recovery right

back to all-time highs before the end of the year. So now we went from, hey, we're hitting batting practice in 2008, 2009, trying to figure out our swing. So we know we can hit grand slams. Any market downturn that we face moving forward, they're going to get right back up there and they're going to hit grand slams. They're going to slam interest rates to zero. They're going to print trillions, if not at some point, tens of trillions of dollars. And I find it very hard to see a world where we will experience in my lifetime an 18 month or longer bear market recession whatever you want to call it unless there is total destruction of the u.s dollar there's default you know there's some like existential uh kind of blowing up of the system

but out you know those those tend not to be important either in my opinion those tend to not be that's that's how i don't look for wars or things to to to to shake the markets back to the foundation so first and foremost there are listeners who are listening to you going if you saw my fucking grocery bill you you'd eat shit and die right now they would there there are enormous numbers of people who do not know how they're going to pay their bills and so the markets in theory can keep going up but at some point what happens populism Who do we elect? Trump. We mowed those lefty commie dogs down. Second of all, look around the world. Democracies are collapsing all over the world. Trudeau, Romania, England, Germany. They're throwing the bums out. This is Western Spring. Something's happening in the world. um thirdly um but i don't know someone asked me in a podcast i think it was yesterday i really

got to stop doing podcasts on a on a day-by-day basis um where where did they hide the inflation and i don't have a good answer to that so again back to um ron grice's chart that there's m2 M2 shut up everywhere for 100 plus years. Where do they hide the inflation? Part of it has to do with China's making things for dirt cheap, which they'll never do again. That's over. If Trump brings stuff back here, inflation is going to get bad. I blame the Fed for the lockdown. If they hadn't behind closed doors said, yeah, we'll cover your ass, they couldn't have locked down so the fed owns the lockdown in my opinion they said no it'll cause inflation that'll be a problem don't do it wouldn't happen um and so what happened so they they they went direct at black

rocks request and uh and then we got massive inflation finally the inflation that has scared me for a very long time in my opinion it's way worse than they they report the boskin commission fucked up the inflation metrics our dashboard is telling us we're doing 55 and when we're doing 75 our dashboard is telling us our tire tires are fine even though they're flat the thing our dashboard is telling us that the engine's fine even though it's overheating so we're getting bad reads on everything because they fucked up all the reads right you know the inflate the the Jobs numbers are like 3 million out of whack, right? I mean, they have caused everything that would tell us that we have problems to refuse to tell us we have problems.

Now, here's what I think will happen. We will have the next thing where they want to be put in the game. And inflation will go nuts, undeniably nuts. and then they'll say we can't do this anymore they've run out of slack they've run out of the the system and and you know the fed i don't know it's recently four or five years ago there was one fed governor rivlin i think said said you know no one knows there's inflation therefore there can't be inflation i'm going you're a fucking moron um but what she's really saying is without the inflation expectations things are pretty safe well the inflation

expectation is now built into the system watch union activity watch what if you're going to build a house three years from now and you said give me an estimate to the contractor how much is that guy going to add to assume an inflationary three years he's going to put like 30 on that fucking house that's inflation expectation right before you can say well i don't even have to account for inflation because it's tame right i don't think it ever was tame go to chapwood go to shadow stats inflation you know inflation has been some handful of percent higher than they've been telling us and they're happy to lie to us about that right boskin commission which came up with a new way to lie to us um um actually published their new inflation metric on the

social security website which is where they most would like to lie to us because they inflation correct so i believe that they are now about to be boxed in by inflation and therefore your model put me in the game coach you say well dude both you blew off both your knees now you can't go back in the game because it's not going to work you think you're 45 years old you think there's a world where the feds playbook that they've perfected over the last you know decade and a half they will do it one more time it'll be so bad that then everyone says no way i think i think i think it they they might just starting it might might cause the trouble so it might be that they'll do it and cause terrible problems by the way i don't think you can flay your way out of the

problems we have either can you add this a legitimate question it's not a rhetorical question to trap you i think can you name a country that inflated their way out of debt not i can't no not out of debt but um well we have debt yeah israel might be an example but here's the problem i'm reading a book about israel and i don't want to talk about it because I don't want to get killed. It's by John Mearsheimer. I will recommend, I'll recommend the book. It's called The Israel Lobby. And I was told by a Canadian intelligence guy who said, look, all these things you're trying to understand, read this book. It'll help you.

And so for all I know, we bailed out Israel to get them out of their mess. But it's the best example. It appears as though they he based the shit out of their the shekels and then um and then and then spent some time suffering and then somehow got it together but but it's very very hard to know where that money flowed from to help them a huge part of um the debt i think is the politicians have been spending like idiots um and i don't think it's just the politicians i think just in society in general We have lost our minds when it comes to expenses.

You know, I always joke with a business, basically, we make more money or we can spend less money. We have no concept of spending less money. And you use a couple of examples in the year in review. But the one that I thought was most interesting is it's true in schools, but it's also true in health care where the physicians, there's been moderate growth. But the administration kind of class of the health care system has exploded. And I think that I saw somewhere for schools, very similar. the number of students has increased like 5% or something. The number of administrators has like doubled, you know,

in that same time frame. Here's an example. Ithaca high school has water called typists. Now they're not typing, right? That's just the name of the line. They're doing some administrative thing. When you went to school, what was your administration look like when you were in high school?

Right. Maybe four guidance counselors, you know, vice principal, principal, couple secretaries, the main office, a nurse, right? right? A couple of janitors. If the guy's cool with it, graduating classes of maybe 400, 22 typists, right? So, and this is in the digital world, right? This wonderful world that you say, you know, we're going digital. We got more bodies than we're supposed to have. So, I don't think the digital world is helping us that much. I really, I don't believe it. I I think, I think, I think that, I don't know what your world's like because it's so different

than mine, but I do so much shit myself that used to be done by someone else. And I'm, I'm being asked to go online to do shit. And, and, and, and it's, it's just, it's a wretched experience. So my favorite is you go to, you know, CVS or Duane Reade, you got to check out for yourself. You go to McDonald's, you got to order for yourself in the kiosk. I, every time I always say the same thing, cause they always have somebody there, you know, they're kind of monitoring the five or six, uh, different kiosks or whatever. And I always say the same.

Cause the idiots like me who can't figure out how to do it. Well, I always say the same thing. I say, uh, this greatest business ever. You got me working for you while I'm paying you to buy, uh, items. And they always laugh. And then I walk out and I say to myself, I wasn't joking. Right. I mean, it's crazy.

Well, how do you like it when you buy, say a cup of coffee and the person turns the cash register at, and there's an 18% tip box. yeah right and you got i you didn't do any you know if someone waits on my table i get the tip what they're doing is they're it's they're they're adding the cost of that labor onto the tip and that's why i'm torn when i don't give the tip because i you didn't do anything for me you just gave me a cup of coffee but it's also true this they're probably paid even less because the tip is making up the difference and so i'm torn on that i have two kids who have degrees in hotel management i talk to them about you know what should i do when i'm asked to tip what do they

say they say no they say no but i don't think they understand the modern economics yeah the fact that this person might be paid six bucks an hour i always do it but i say i say to myself uh i hope it goes to the person not the not the company because that's one of the reasons why i pay cash when i tip is that i think the odds of them sticking their hand on the cash thing and pulling it out and getting to take it home but but then you get this stupid thing where trump comes up with it and then harris comes up with it because she didn't have an original thought in her entire life best i can tell um to people get tips to be tax exempt it's just a payment yeah why why does getting tipped get you tax exemption it makes no sense whatsoever it sounds like you're

helping the little guy that's what it sounds like people get tipped are are down the food chain Of course. Right. So it's a blue collar, sort of. One of the things I've been saying to people is if you put a president in the White House who measures the health of the U.S. economy by the level of the stock market, there are very high odds the stock market will continue to go up because he will throw everything he's got at it to finish. Are you listening to what he's saying now? About? The stock market.

He's downplaying it. he um he is but then he's also saying that interest rates are too high and i think right i think that what he is doing is he uh expectation he's playing the the classic uh let me talk about how bad of a job you know i'm walking into how hard this is look at all the problems whatever and then four years later he can claim a victory now one thing that i haven't heard a lot of people talk about that he needs he needs the correction to appear soon of course of course. Right. So he needs the carnage to appear soon enough where you can say, look at what I inherited from Biden, the longer it goes. So I don't think you're going to see Trump trying to

pump the markets up when he when he took over in 16. By contrast, he spent four years trying to get reelected. He doesn't have that now. He's worried about legacy. So so this is going to be my point. I do not hear a lot of people talking about the fact that Donald Trump knows in four years he can't be president again and so right he can throw the kitchen sink he's 78 79 whatever he is years old and so there's an element of kind of like whatever i do in the next four years i'm going to be remembered for and whatever the long-term pain is whatever uh you know the stock market performance after i leave it all that stuff is not going to be associated with me if i want people to think i was the greatest president of uh in history i could throw the kitchen sink at

make sure the stock market's higher the economy's rocking jobs are filled you know all this stuff and so it makes me wonder even if all the metrics you're too low a level you're too low a level all right so i think he sorry for wiggling my brother said stop wiggling i said fuck that um i think he is looking at a higher plane and that is i think he sees the united states in big trouble and i think he he this is maybe this is fantasy but i think he sees a country that is in desperate need of repair and that to be a great president he's going to have to fix that and he's going to have to and that's not pumping the stock right and that's not pumping the economy so so so i think within a week of him getting inaugurated we're going to see fireworks right i think he's he's

not coming out of the gate in what in what way well for what day one i think he'll probably pardon all the j6ers let's start with an easy one he should put it this way i will be so disappointed if he does but i also think for example if if musk is given advisory power that i'm hoping did you read musk's biography yes i did it is there anyone more qualified to cut costs and musk oh i think that he is uh off the charts uniquely positioned i'll even give you an anecdote for you so um i went and i was meeting with somebody um that works at x twitter and uh he happened to be uh working there before he was there uh during the cuts intimately you know in the room saw a lot of the stuff whatever the stories that he told me would blow your mind

Because we all know he cut 80% of the staff. The guys who tried to short Tesla, if they had an advanced copy of that biography, they would have never fallen into that trap. See, I don't agree with that. You know why? Because I think that so many of them, you know, everyone talks about like Trump derangement syndrome, the like Elon derangement syndrome. It got them. It didn't matter. What they would do is they would go through the book.

I know some of these guys, right? They would go through the book and they would tell you how it's all bullshit, that Walter Isaacson is exaggerating. He got paid under the table. Elon's lying, you know, blah, blah, blah, whatever. I saw recently Matt Levine at Bloomberg, who I really, really respect. I think he does a fantastic job of breaking down pretty complex things in a simple language, et cetera. And he put it perfectly.

He said, Musk works 100% of his time on SpaceX. Musk also works 100% of his time on Tesla. He also works 100% of his time, right? Like that is the public facing. And he's tweeting 24 hours a day. So he went through it. He talked about Twitter or whatever. And he goes, and then by the way, he recently became one of the top players in the world at Diablo 4.

It's like, you know, video game or whatever. And he spent 100% of his time on that. So you go through all this and you say, wait a second, like, how does he do it? And he's like, you know, there's theories that the video game, he paid someone to do it. Or there's theories that, you know, he's really good at delegation. Or there's theories that, you know, whatever. I thought about that. I wondered.

Whatever the thing is, right? He has convinced people that he works really hard. but really if you look at why has he been so successful in my mind it's because he has one of the greatest uh bullshit filters in all of business he's able to his biography where he's looking at a 1.5 million dollar refrigeration unit to be purchased from boeing and he says fuck it goes down to walmart grabs two air conditioners and cobbles them together of course and and so so and you know as as i've said to people you know he buys twitter overpays by some people's reckoning although it's it's nothing for him i mean it's a lot of money for him but he's

probably going to get it back um but but if you said he's going to go in and fire the fire the the leftovers you would have said out 20 25 but he fires 90 he so so if there's a person who has the capacity to go so so day one here's what i'd love to see let's just pick up i want to see pyrrhic victories they don't to actually cut your way into a balanced budget of any kind is not possible at this point i i do not believe it's even theoretically possible because because there's only like 13 or whatever that's like non-defense non-discretion you know or discretionary spending or whatever he could cut defense well hold on so there's a couple issues here so this whole idea There's a $2 trillion annual deficit.

I've heard estimates. You know, Howard Letnick told me that he thinks Musk is good for $500 billion right out of the gate and potentially more over time. But my understanding is that 87% of the budget is defense and or non-discretionary spending, which only leaves 13% that if he cut 100% of it, it'll only be a 13% savings. I don't know. True, not true. I think that actually your comment about fireworks, one of the fireworks that people are not ready for is there is going to be some executive power used, whether they actually can or not. They're going to go to court and they're going to say, we can override this stuff. We're going to go and we're going to get rid of all of this waste that is occurring.

And I think that's going to be one of the biggest court battles of 2025 is how much power does the executive branch actually hold in terms of government spending? So let me ask you this question. So there's a couple of things here. One is so. So the parent victories, what would be a trivial one? I happen to have dinner with a lawyer who knew about things like the Chevron deference story and how profound that could be. And he said, we're just waiting right now. And that's where regulators who essentially have prosecutorial power no longer can just do that. So it's more important than Roe v. Wade, in my opinion. But we're waiting to see what the consequences are.

The wife turns out to be a woman who ran a not-for-profit, who organized 600 not-for-profits for disaster relief, right? She said, and I said, I guess I shouldn't mention FEMA to you then. And she said, oh my God, she started dropping F-bombs. She said, FEMA, and I've written about FEMA being worthless, destructive. she's absolutely positively confirmed that and she said we train our people to spot fema people to avoid them and and and so theme is 29 billion it's a drop in the bucket but day one gone gone and you say whoa you know what what will happen if nothing they don't do anything you weren't

listening read my lips right they don't do anything they're worthless so i would love to see day one fema gone white and and then you look up and say well you know the one thing fema did is this i say okay go do that then fine have a ball but even even that so like this is a great example is i think that there are good people who work at fema who actually want to do a good job etc she says no she says no okay so that's even a bigger deal but let's just let's just say for the sake of this argument that there are good people there that want to do a good job etc there's this massive bureaucracy did you pay attention to what happened in the mountains of north carolina okay so one of the stories i heard that just pissed me off beyond belief that i think really

really resonated with a lot of people is there was a guy and his son i think you know guys whatever 40 years old something like that and his son was a teenager and uh they got in their private helicopter. They flew over the mountains and they saw a husband and a wife that were on the mountain next to their home, waving down people. And he landed. He said to his son, get off, stay here with the husband. I'm going to take the wife to, you know, the disaster relief headquarters or whatever, because the helicopter can only hold two people. I'll be back. He takes the wife and he lands lets her out and the police say to him if you go back on that fucking mountain we're gonna arrest you and he says my son's up there do what you're gonna do i'm gonna get my son

and so he loads up his helicopter uh with a bunch of supplies flies back lands and he's got to tell the husband i'm taking my son here's a bunch of supplies i'll come back for you tomorrow because if i take you back to that disaster relief center they're going to arrest me and i think about that and i say to myself wait a second here how is it that private citizens in that situation were able to get supplies equipment etc to these people faster more efficiently than the disaster relief i i wrote about this about uh after katrina okay i wrote about the merits of price gouging i defended price gouging i kind of um i got onto it by the name mike mungowitz who's an economist and and i i i actually gave a talk in an investment meeting on the merits of price gouging

explain and pointed out that that it's a fictional thing right so you know during a time of disaster your neighborhood pharmacy is not going to price gouge your walmart's not going to price gouge it There was a claim they did, but it turns out it was Photoshopped. You could actually see it was Photoshopped. But Walmart immediately started apologizing. Bottom line is you want some guy to load a bunch of generators in the back of his truck and go down there. And if you arrest him for price gouging, he's not going down there the next time. And he's taking risks to go down there.

So this price gouging idea is just crap. You don't have to buy it if you don't want. Well, we also call it surge pricing. Right. So what did they do? Well, FEMA caused the deaths of many in Katrina. FEMA directly caused the deaths of many in FEMA because people tried to go down there and they cut them off.

It's a turf war. So the idea that FEMA has good people is wrong. According to the woman, she said, it's a reverse Darwinian selection. Anyone who's worth a shit can't stand being there. They leave. So she said, it's a DEI nightmare. It's a hierarchical nightmare.

She said it is surreal to see the FEMA headquarters when they set up. Now, my wife was in the Adirondacks for Hurricane Irene, where it was a disaster. I included that in my write-up. Now, up in the Adirondacks, they take care of themselves. Everyone has a chainsaw. Everyone knows how to swing a hammer. Every third house has a backhoe. I go up there two weeks after Irene rips through there and floods the shit out of the North

country. And they've rebuilt all the roads already. They've done everything. They fixed everything. They're already jacking up their houses again. And my wife helped run a relief center that they set up. And about two weeks later, FEMA shows up, puts up a banner, takes a photo, puts literally, literally a Band-Aid on one guy's finger and then leaves. So FEMA, line them up shoot them i don't care what you do get rid of fema right the problem is the federal government has a ton of agencies like this a ton and so that's why i want to release elon say start cutting we will undo some of the damage you do i want you to go in with a chainsaw and start cutting and when we find out there's something we needed that you

cut off you cut off a limb we'll stitch it back on if we have to and so that's what i'm that's And that might be fantasy island for me, right? That might be, I might just be dreaming that that's going to happen, but I don't want anyone to stop them. Well, part of what I think is so interesting here is we're going to find out who actually has, who actually has true power. He's got, I think, 200 million followers on Twitter. How much is like sunlight truly disinfectant?

And we saw the one bill that was going through when he started tweeting about at him and Vivek and you know uh they were able to show look how crazy this bill is well here's all the stuff in it whatever all of a sudden there's pressure the politicians cave to come back they get something else approved and what cracked me up was um everyone who did not like what he was doing started saying oh who elected the billionaire to run the country blah blah blah whatever hey but what I kept thinking to myself is wait a second here this is the will of the people all he's doing is he's telling everyone else look at the craziness of what they're doing and everyone is getting upset right so the beauty of elon is the fact he's on the spectrum

means you know there there is the deep state elon right every company's ever done is deep state but i also believe the deep state desperately needs them and they can't control them so it's one of these things where it's it's it's a uh it it is a wild creature it's like a camel or something where the one hand you need them on the other hand they'll bite you if you turn your back on him um and and so i think elon um elon could be a great force for good and and i'm hoping he is i hope he doesn't turn out to be a wolf in sheep's clothing um again his biography paints the same picture of him that i'm now portraying of him um i think trump's a team every single one of them they're young they're brawlers they each have a personal reason why

they don't like the system that existed before they got in there, whether it's Bhattacharya or Tulsi Gabbard or, you know, RFK is talking about making America healthy again. You wait until he's confirmed also it's going to be, fuck that healthy shit, we're going after pharma. Right? He can't go after pharma now. He's trying to make America healthy again. So I would say, oh yeah, I'm fine if he wants to make, you know, broccoli, the vegetable of the country, right? But that's not what he's spent 35 years chasing that's what he's been spent the last six months chasing trying to look

harmless and and by the way all the bullshit trumpets out there i mean actually taking over greenland there's some logic i'm not sure about canada uh panama canal is profoundly logical apparently that's a big issue um i think the greenlanders might even like to be a u.s protectorate at this point instead of denmark let's talk let's talk about each one of these three well why do you think greenland makes sense what's what's happening here while we are talking about trump naming the gulf of america we're not talking about his appointments now who's it providing cover for well first of all it's providing cover for trump it's also providing cover for the other team that's probably gonna have to let this shit go by and they don't want

this on the headlines that they lost and kennedy got in and tulsi got in and so they'd like to be talk about other topics too if these appointments are going to get made now one other thing two other things one is recess appointments you can make an appointment at recess and uh and so i think you can make these appointments whether you like it or not two there's some goddamn arcane law which i can't remember the name of where where they can pass a law to spend money and the president can say yeah fine but we're not spending it and so he may have the power to say look here it is in the budget but it's just sitting in a bank account right now that'd be powerful that's a fun story that's a fun story do you think he's naming the gulf of

mexico to gulf of america to get around all of this drilling stuff could be it also could be there's a certain logic to it because it really does bridge the two americas and i i don't see why you'd have to change the name but you know history's filled with abrupt changes and crap like that yeah because the argument that i saw that uh again you you don't know how much of this is uh his thinking or not but if biden's gonna put all this stuff in and say hey you can't do certain things with drilling in the gulf of mexico and he just renames it the gulf of america well that law is uh no longer no longer makes sense it could be that somehow negates contracts right the other thing i would like to know

is if there's a way to take i think biden's administration i haven't said to say biden because we know he's got no brain left um but i'm gonna say biden um i think all these things that are being passed that are sort of what's called green goblin strategy to destroy the joint on the way out right um they might be negated a simply right it might be trivial to negate them but if let's say it's not i think you take them to court and saying not of sound mind and body i think you say the guy was demented well he can't stand trial no no but forget that you just say the signature that put this into place is not a valid signature no that's what i'm saying if uh somebody already determined you're not fit to stand trial then how are you

fit to sign a contract yeah right and you know what you do for for the next four years you fight in court what's going on none of the shit that he wanted to do that's what's not going on none of it's happening yeah that makes sense um greenland and the panama canal let's start with those two uh you think they make sense yeah greenland's got 20 000 people they're proximate to the western they're in the western hemisphere right denmark has done nothing with it um being under the united states umbrella might appeal to the greenlanders right they might say hey you know we'll get welfare and all sorts of crap right um i don't know what the resource play in greenland is i've heard stories that underneath that sheet of ice is a wealth of resources and i'm sure that there

are people who are appalled by that thinking but that would explain why greenland's a bigger stakes than they say um it's quite possible the ruskies are going oh shit they're gonna get greenland i can't believe it um panama canal i think it's just panama canal is for us is what ukraine is for putin we can't let someone get control of it i've heard that there's trouble i've heard that we're at risk and so for us to go down there and say look we gave the canal back sorry that was stupid we're taking it back you know if you don't like it meet mr f-15 over here f-16 f whatever um we're taking it right and that would not be irrational i my i've become a bit of a dove in my old age here you know i i think we fight way too many wars and i know you're ex-military

and i bet you think so too um but i think sending some submarines down to the canal to make sure that that that we take control of it again again i'm not up to speed so it's possible that's just a red herring and that we haven't lost control and it's a stupid thing but i think uh right now control um you know it's kind of like uh if you have a car and uh you let your kid drive it but they got to bring it back it's still your car you know i think there's a little bit of that going on right now um from what i understand is like the u.s is definitely a heavy presence still and and you know uh all of that i think the concern from what i've read is it's more about the influence from the East

and specifically China starting to go. I mean, look, there are a number of different stories. I've heard it's China that's the problem. I've heard a number of different stories about for example, software in the cranes

in US ports have over the air update capabilities and back doors etc. And there are very real national security concerns around that software because if somebody in china could shut off the cranes in our ports that'd probably be bad right right so there's all these things and you go they already china could shut off so much of what we

do i mean you know that's true i don't know it as in factually know it but put it this way you would have to to be safe you would have to assume they have the capacity to do so the ship that hit the bridge in baltimore right that's a great example you know there's oh you know the what's the story there well the ship uh lost you know power and it went off course i hit the bridge and knocked the entire bridge over and and then and then it gets absurd i actually thought the thing backed into it i kept looking at the video going it looks to me like it cleared the pile on and backed into it um but but but then then it turns out wiped out a huge port a really important port and and then you find out that the company that that owns it is chinese you find out that

it's actually a company that's known for a super high-tech remote monitoring and control of their ships and you go and that they they lost power and then they they talk about the fbi retrieving the black box they go retrieving the black box it didn't sink you walk in the ship as they give me the fucking black box right and then the question is a ship that's supposedly under this a high-tech ship they don't have a black box that shit's going straight to the cloud right there's not a black box why why would you ever have a black box again right and and so the whole story's crap looks to me like a beta test of hacking a ship which supposedly are very hackable and they sent the ship into the bridge and say oh yeah that worked that's pretty cool do you think they'll ever

rebuild the baltimore bridge uh i am told uh that that bridge was built because you can't send toxic and dangerous things through the tunnels no no no and no no you're at you're answering why is the bridge there do you think with all of the environmental permitting with all of the bureaucracy etc loss do you think that we will ever rebuild that bridge don't you think it's possible that when the federal government decides it's time we need a bridge that they're just gonna say screw that and do it no okay because because because in la there's no water in the fire hydrants la still exists there's no water in the fire hydrants because i didn't know uh how big a smelt fish is but i've been down my rabbit hole because my hand a little tiny fish

little tiny fish insured that there was no water in the fire hydrants how much of the brush all the things that people know that you should do to protect against this stuff how much of it

didn't get done because they were held hostage by the environmentalists and kind of the extremes in that whole process and then you want to tell me you're going to go build one of the largest bridges in America in the ocean i don't know well except for the fact that the the not doing what the the thing they failed to do in la the consequence is now you've shown up to rebuild the bridge the

consequence predates the process so now that la is burned to the ground the rules may change immediately the bridge now that it's in the middle of the drink the rules may change immediately You want to you want to know what my prediction for L.A. is? Yeah. They will rebuild. And there will be the biggest fights are going to be over racial segregation. Oh, I would have no trouble imagining that. But it's going to be an unbelievably complicated story. the other thing that clicked this morning when i retweeted a meme and i said wait a minute that's not funny at all um how many people who are not on radar died in la that we're not hearing about how many illegals how many kids how many trafficked kids that came across the southern border right did you see the uh weather channel clip i don't know on twitter there's uh it's

It's horrific and incredibly sad, but the weather channel is panning over the destruction and they zoom in on a house and there's human remains. You know, at least it looks like human remains. Oh, I didn't see that. Sitting right there. And the camera guy doesn't realize at first and all of a sudden he like, you know,

kind of like moves the camera in a way where it looks like he like realized what was happening on live TV. And, you know, right before this, I went and I looked. They're saying that it's about 30,000 acres of land that's been burnt. They're saying there's over 10,300 structures that have been destroyed. They're claiming at the moment of what they know, there's at least 10 people that are dead. I've got to imagine the number is much, much higher.

It's got to be 10 times that minimum. I mean, there's so many people who are not on a radar. Yeah. So you get that. Then you've got the estimates right now are like $135 billion of damage. zero percent containment of the fire crazy with supposedly arsonists running all over the place by the way if you were a foreign national that got shipped over the southern border to cause trouble now's a good time to cause trouble do you know who uh joshua steinman is

does that name ever come up tell me so joshua steinman is uh he was previously on the national Security Council, you know, served in the military and now runs a company that is fully focused on protecting critical infrastructure from cyber threats, right? So, you know, I made a small investment in the company really is just a, hey, I like this guy, I want to back Joshua. But the company Galvanic is fully focused on, you know, the equivalent would be water treatment plants and various, you know, critical infrastructure. How do you make sure that adversaries aren't able to hack them, etc.?

you know how some people on twitter have something they tweet all the time and as they tweet it they see news stories and they just like keep reminding you of the same phrase right and it's their worldview joshua steinman's phrase that he continuously tweets over and over again is one question how many foreign sabotage teams are already in the united states oh i've asked that question so many times now the really interesting question is who opened those borders knowing that that would happen and why so those borders were opened up by you know by an administration of some kind right just generally speaking there is no chance that they didn't send foreign nationals who are basically hit squads across that border

because if they didn't, right, if our adversaries didn't, they're of no risk because they're just too goddamn stupid. Well, and I think that there's two categories, right? There are what I'll call true terroristic threats. And it's very clear that there's a lot of- And then there's the MS-13s and things like that.

Right, the MS-13s will wreak havoc. I called a buddy of mine. Well, I called a buddy of mine who he's got a house in Hollywood Hills and are kind of like, you know, near the canyon. And I said to him, how's it going? He said, well, earlier today I was fighting a fire with my hose outside my house. So I said that wasn't fun. But he said, but he goes, there's a real problem with these these gangs looting. And I said, what do you mean?

He is what he described to me. he said what you see is a car of young usually latin women pull through the neighbor they're going incredibly slow looking out the windows etc they will pull over and they'll stop three four five minutes later all of a sudden here comes a car of young usually latin men fully you know decked out ski mask the whole thing they'll jump out they'll run they'll hit a house they'll come back he's like three minutes man back in the car band they're all off and he's like and the women are serving as the lookout for the men right and and the problem is these are houses that have been emptied because they might burn and so these houses are in pristine

condition they're million gazillionaires whatever you want um and and so and this is like these professional squatters and stuff back to the you know when you have a person squatting in your house i started to talk about this again there's a thing called squatter squad where they go in and they they they clean them out for you and and there's sort of an implicit you're gonna die if you don't get out so it's time to get out um but that doesn't work on an ms-13 squatter well those guys are not going to be worried about a louisville slugger the connection between national disaster and looting is not just a foreign you know kind of gang member affiliated thing right if you go back to katrina uh i know guys personally who uh were in the national guard they got deployed to

Katrina, and they said, oh, we're going to go help people and stuff, whatever. They were walking around Walmarts with their M4s because there was cash being kept in the back because the brink trucks couldn't come and pick up the cash. Millions of dollars, right? And so they had to protect because there's looting, there's all these issues, whatever. So, like, I don't think that

this is a purely American thing. I think this happens all over the world, whatever. But I do think that usually a national disaster like a hurricane, nobody, you know, presses a button and the hurricane happens. But, in this case in particular is this the first time that we're seeing oh wait a second it are there people

and there's now videos online of you know what it appears to be and what is being reported by the police as potential arsonists who are getting arrested for starting these fires do they have a connection to the people who are then are going and robbing the homes we're gonna find out let's go hit this neighborhood so you start a fire upwind of the neighborhood you force everyone to clear out and then you take the neighborhood so here's a question that i asked on uh on twitter if the fires were started by arsonists not proven yet but let's say if what do you think the proper punishment should be death yeah so this is the only problem i have with the death penalty the only problem i have two problems one is it's um we get it wrong right so there

really are cases where some black guy spends 20 years in jail on death row and you find out he didn't do it. The second is that it costs a ton of money to execute a person because of all the checks and balances. It's cheaper to just throw them in jail and not worry about it. Now, the interesting thing is that if you're innocent, you want to be on death row. The reason is because there's organizations trying to get you out. Once you are no longer on death row, they don't care about you yeah it's interesting it's like uh obviously if they don't get you out it's not good right but they're working to uh to do it i never thought of it that way yeah because you've got whole organizations who think it's immoral to to whack you and i i just

i don't have i don't have a need for the death penalty i don't i don't no matter how bad you are I don't have any. I, by the way, spoke with a guy in the Adirondacks. You go through Tupper Lake. There's this humongous institution that looks like it must have been some asylum at the turn of the century or something. It's huge. It looks like it holds 2000 people. And I ran into a guy who works there. And I said, what's in there? And he said, it turns out there's relatively few people. there's more staff than people the people in this facility are are those who because of various ailments and stuff are considered not qualified to be tried in a court of law because of traumatic brain injuries or whatever and he says the horrors behind those walls are

extraordinary i could only imagine right but they're not they can't be put in a normal prison and stuff and so they have these guys in this facility and and they're often sort of low iq functionally you know there's there's they're just various characters who were deemed not capable of defending themselves in court and by the way that's well spent money twice two staff per person to keep that guy off the street that's well spent money that'll save society a lot of pain of course um we have the incident in new orleans we have the incident in vegas um vegas there's a good what what i want to oh that's a different one i was talking about the vegas shooting a paddock no no no i'm talking about the cyber truck um one of the things that

i remember when i got out of the military in the early 2010s being a topic of discussion was certain gangs both american originated and uh foreign were sending their members into the military to get trained and then they were coming oh man and the reason why and in particular i remember specifically uh somebody showed me a video uh in california and i'm not an expert on california gangs or gangs in california but i believe that there are two gangs uh the nortenos and the serenos and uh the reason why they know that some of the gang members uh had military training is because there was videos of them literally shootouts where they were using military tactics and so whether that hand signals and everything too

right the kind of the you say hand signals is the elementary i'm talking about how do you go hit a house how do you clear the house how do you how do you pie around the corner right i mean just like The actual tactical use of weapons, et cetera, on this. So the reason why I say that is, that's not hard to imagine. I assume that happens in many areas around the world. Obviously, you get into the whole contractor world, whatever. But now what we start to see is those two individuals, both in New Orleans and in Las Vegas, that feels like this is a bigger story where you have a special forces guy. you've got somebody who's in the military for a long time deployed overseas whatever

how do you you know kind of sift through all this well so one of them it gets to the question of what the hell are the comment section in podcasts i was i read comments you never know when someone's going to say oh by the way this is a really cool video right um but but i mixed up i mix up those two events i i because i've been busy and i have trouble and i have trouble remembering which one is which and um one of them a reporter goes in the house after the fbi supposedly went there new orleans that was the that that was that was new orleans and she's first of all going what is a reporter doing in a crime scene right and she goes to the house and the door had been bashed open supposedly and she's walking through the house and she's going oh you can see bomb making materials

here and you can see recipes for bombs over here and you can see that the crown is open over here and i'm going this is a poorly written tv show right this is insanity and first of all if the fbi had been there every last thing in that fucking house would have been bagged up and taken away let's start with that and they wouldn't leave bomb making materials with a door bashed in right there's just nothing about it and then someone posted something said oh by the way that chick, her name is such and such, she's Mossad. Now, if that's true, this plot thickened very quickly. So, but there's something wrong with all these stories. The assassination against Trump are just total nonsense if you try to interpret them literally. They're just total garbage,

especially the second one. Do you think that Trump should have the inauguration in public? Oh, that's a good question. I'm not sure he should be in public ever again. i don't know how you protect the guy if if the deep state wants him yeah and by the way i'm a big believer in mk ultra so all you have to do is get some guy who's nuts who's been brainwashed to to go cap them um so you don't even need a clever um you no longer need a clever uh conspiracy you know you don't you don't it doesn't have to be organized you just need one guy is willing to be self-sacrificial and um and so yeah i don't i don't know i don't know i'm gonna ask you that question speaking of trump let's go back to him coming into office um do you

think that he reignites inflation i don't know i i think inflation might reignite anyways but if if you bring manufacturing ashore that will reignite inflation right explain that well it's going to cost more right you don't buy a six pack of tube socks for 10 bucks that are made in the united states right right now the with the globalization i mean the guys who want to on shore manufacturing are forgetting about the basic principle of economics is that you the free market goes and finds the cheapest place to do stuff right and so if china can do make you know they no longer make remember post-war japan this this is the pattern every time so japan comes out of world war ii what do they make they first make trinkets made in japan was like a meant it was

crap then you start noticing it's the stuff's getting better it's getting more sophisticated next thing you know you know those toyotas are pretty good cars right oh sony just invented a walkman right and and and so so you go through this hierarchy of improvement so china started out making bullshit right dirt cheap trinkets stuff you buy in the dollar store or whatever and now they're making shit that we don't know how to make right it's at that level and so um so if you bring if you bring manufacturer stuff on shorts it by definition will cost more because you are artificially uh shutting down the mechanism by which by which you find the cheapest price. Now, here's the problem with offshoring it. The revenue and income and wealth creation

and accumulation is somewhere else, which means we have this big trade imbalance and this big debt. And so it's lining the pockets of people in other countries and elevating their quality of life and their standard of living. Because that's where it's being made. That's where the profits are being made then we get cheap goods but we're buying increasingly we took on debt to buy them because we weren't making it here by the way the digital world that you like that's not being made here either hey that coding is not being done here i don't even know why they care about this visa issue they can just offshore the whole thing one of the big trump policies that he promised on the campaign trail is the Strategic Bitcoin Reserve, where the United States would hold

the 200,000 Bitcoin it already has, and it would buy more Bitcoin. Do you think that he'll do it? I don't know. Trump should be taken seriously and never literally. So you can't, whatever he says, there's an art of the deal component to it. Everything he says, best i can tell um i have a question for you there's there's a quote by a person named williamson and i don't want to go deep into bitcoin because you and i are on the other side of each other on this but i'm by no means hostile to you guys i i totally support all your principles we're sound we're sound money uh allies that's right that's right i have a ton of gold you have a ton of bitcoin we'll swap a few occasionally right i don't wear gold

um and uh there's a woman someone said you know at some point will the energy cost of a transaction of bitcoin is it going up with with the growth of the bitcoin is that is that a natural component of bitcoin no i think it's been the opposite so one of the interesting things is um let's just energy used per transaction, if you were able to drop the energy cost, obviously, that will be attractive. No, I'm just talking quantity of energy. Quantity of energy. Forget the cost. What actually has happened is we have been able to make Bitcoin more efficient. So each block, without getting into too much details, each block of transactions, say one megabyte of transactions fit in there. What has been developed is something called the lightning network,

which allows you to make tons of transactions and fit all those transactions into that block that you otherwise couldn't. And so each block is becoming kind of more dense with transactions, if you think of it in that way. Got it. Got it. And so I actually think that part is not really that exciting. It's already kind of happened, right? I think the energy side is the more interesting one i'll give you two ideas um a guy reached out to me and um i don't know if it's possible or not but he said listen you know one of the the uh benefits of bitcoin is that you can actually monetize energy at the point of creation or the point of consumption right stranded energy is a good way to think of it i like it so gas flaring etc he said to me well why don't we just

launch a bunch of uh satellites with solar power miners use starlink and now you can bring the monetization of space solar energy back down to earth has anyone done the cradle to grave energetic cost of doing that i have a couple people who have sent me by the way cradle to grave is a bitch of a calculation and that's where the that's where the um the alternative of energy guys lie their ass off yeah well so there's a couple people who've sent me different calculations not the full calculation you're describing um and one of the big issues is the heat right that these miners uh create and so then you get into like well do you have to do some sort of like internal you know kind of sealed cool you know do you like immersion cooling inside of the

equivalent of like the next iss what again i'm not uh uh smart enough to figure that out but i thought that was very interesting of okay so now we've got multiple technologies coming together you've got starlink you've got bitcoin you've got solar whatever right so that brings me to um artificial intelligence which feels like with the rise of ai and ai agents and kind of all this stuff money is going to have to become digital so whether it's stable coins and it's just you know dollars on oh it is going to become digital there's no question yeah is these technologies are all coming together because you know if you take tesla they've got the robotics they've got the artificial intelligence machine learning they've got bitcoin on their balance sheet like

these companies really are starting to kind of push this stuff together and so there's two questions that i think are interesting one for people like you and i how do we know what we see read or hear is real oh god yes that's the million dollar question now and it's actually getting harder and harder with each passing year yeah i mean now that remember the title read my title what's my title you got it right there what's the title what is a fact right yeah i mean look that's the problem i was reading a book um recently uh and i was making the argument that human intelligence is more complex and unknown compared to machine intelligence and so no matter how many innovations we make on the machine intelligence side we're still not getting closer to the

kind of general intelligence uh because we don't know enough about the human uh intelligence component and there's things in the book that i thought were interesting there were things for a guy disagreed with in the book whatever but one of the things that uh was a great reminder was the exact wording that alan turing used when he created what now is known as the turing test right and for those that don't know is um there used to be a i think it was a game where there was like a referee or a judge there's a man and a woman they couldn't see each other and uh the referee couldn't see either one of them and he tried to guess who's the man who's the woman and i think the man was supposed to deceive the judge the woman was supposed to help the judge

and so the whole idea was like can they figure out who the man is who the woman is and alan turing used that as inspiration to come up with the idea of if you have a human and a computer both submit a piece of paper you know a writing can i tell which one's created by the computer which was created by the human that was the turing test the original turing test i don't know about you but i read should the chat gpt writes i got no clue i couldn't tell you who claim they can see that it's chat gpt i was going to teach a writing course fresh cornell has freshman writing courses and the idea is look you learn to write but we'll offer any imaginable topic. You can Dostoevsky, science, whatever, but you're going to write papers and

they're going to edit your papers, right? And I was going to teach a freshman writing seminar. I got clearance from both sides on personal finance. And I figured it would be real beets and carrots, savings, 401ks, differing Roth and regular IRA, which I have a serious bone to pick with the regular with the roth ira things like that and just talk about you know the cost of college even you know how do you think about you know how do you think about you know paying back these loans and how do you think about saving how do you think about uh the cost of owning a car how do you write all these things and um and then chat gpt showed up and i said fuck it i'm not doing it because i didn't want to be editing a bunch of papers written by a fucking computer

i could just go search it myself by that you know it just didn't inspire me um i find grok really useful so by the way we've we've probably talked about um i did a debate with steve keen on climate change and i happen to and i don't know if it's in this part or in the next part but i happen i write about climate change and years ago i gave up on it and said no it's a total grift. I think it's 100% grift. But I went to Grok and I said, in very straightforward language, I said, Grok, could you please provide a list of 20 prominent scientists who think that climate change is not a crisis? And Grok fired out 20 names. I knew at least maybe 18 of the 20. And it even gave some information about what each one thought. And then I changed the

question just a little bit i said grock could you give me a list of 10 scientists uh 10 solar physicists who think climate change is a crisis and grock said there are no definitive statements by solar physicists saying climate change is a crisis the solar physicists the guys who understand the sun cycles the source of all this heat that we're supposedly worried about there's not a single solar physicists of any consequence whatsoever who thinks it's co2 that should rattle the cage of you know their climate change cultists who will just their heads will explode they'll find some reason to ignore that fact the solar there aren't even solar physicists on the ipcc which is the bible report the solar physicist said dude there's fusion going up that ball of flame up there

right that's the source of all the cycles you're seeing in the temperature of the earth right there that's it period qed it's not about co2 it's not about any of that shit um and and so i find i find uh rock really useful because oftentimes you know you google something and you get all these links you're clicking trying to find one that doesn't have the bullshit you go to grok and it provides you a couple of paragraphs so it's a great improvement in searching in my opinion especially if you're clueless of where to start. Completely agree. But at the same time, it also is in the middle of this.

And I gave this example, I just gave you in the debate on climate change. It was great. But I referred to AI as squeegeeing the drippings of the internet, the drippings off the floor of the internet. It was just, you don't know what you're getting, right? I also think that AI, and the second point, is coming for people's jobs that previously thought their job was safe. Oh, absolutely. Right?

People knew the self-driving cars, whatever. There was some easy, low-hanging fruit. Okay, this is what this technology does. Here's a job it could replace. I don't know, man. Artists. Well, the problem is technology always comes from people's jobs. Yeah.

So here's the problem with creative destruction. creative destruction um is a good thing but what you have to get out of it is each generation has to sort of amortize right you have to pay the cost of that generation make something out of it before the next generation comes so for example we went through blockbuster videos right and and that was great the question is what it obviously was an important stepping stone to the digital world but but the question is can you afford for creative destruction to be fast because you'll you'll build and destroy a lot of stuff if if if the gen and this hit me one day when i moved into labs that were pretty new because the old labs were unsafe i move in and

and um we were talking about hiring some new kid that we put them in labs who are six years old and they said um well we have to renovate them i said no no you can't do a lab renovation and get six fucking years out of it you gotta get 30 or 40 years out of it right and and and and that's when it sort of clicked that that if you think creative destruction can't be too fast every two years bulldoze your house and build a better one and see how that works out for you. You have to get the benefits of that generation. I think we're accelerating through a lot of generations of stuff.

One could even argue that what it means, therefore, is don't put out the incremental new generations that fast. And that may be a consequence of bad monetary policy, for example. It might be easy money allows you to build the next generation, which is not a good enough generation to justify bazillions of dollars, but you did it because money was cheap. so if you say no we're going to keep developing now we should strike now we should build better houses right and i that cheap money causes a lot of things to happen that you don't even know or

necessarily due to cheap money i agree the last thing on uh ai and um robotics and automation that i think is fascinating is going to drastically change the world is uh we have essentially normalized the use of automated kamikazes with these drones oh oh who who talked about that someone did you see the interview of tucker carlson with the ci xcia guy i did not and and it was really interesting because he talked about the ci and you go i know he's lying about a percentage of this some of the stuff i go what he just said i do not believe he says i know of no example of you go well i'm sure it happens so you're bullshitting us but at the end he talked about the total game change of um of drones and how it's how the risk it poses to to militaries

that are based on there's a zillions of dollars of investment where a drone can just wreak havoc just forget the military for a second i'm not saying that this is true i'm not saying that uh i know one way or the other i think we should ask the question yesterday it was reported that uh i think they are called uh skimmers the the planes that fly over the ocean and grab some of the water uh if i if i la yeah if i understand correctly uh a drone hit one of them and took it out of commission oh god damn it and um again i've seen a million drone videos so you know There's helicopters, obviously, on the news, whatever. Like, there are people trying to capture footage, like, all this stuff.

So, like, again, I don't know what's true, what's not true, whatever. But I do think that as more of those accidents, and I'd clarify it as an accident right now, happen, I think more and more people are going to ask themselves, well, was it one of our adversaries? Or was it just somebody taking photos, you know, because they wanted to go viral online? um and so i did it could have been the latter whereas the former people going hey we could do that too of course they didn't learn if they didn't learn from that story they sure as hell have it now so that type of stuff i think is um you know frankly uh makes things much much more complex than maybe we thought another thing that's happened um since we talked last year that i thought was uh pretty noteworthy is the rise of prediction markets and um those seem to

be one much more accurate than people thought and two they seem to uh be drastically the big one poly market poly markets there's two that i pay attention to so poly market is the bigger one but they're not available in the united states uh cow she is the one that is available in the United States, um, that I spend most of my time looking at for like domestic based things. How'd you, how do you spell couchy? K A L S H I. Okay. And so, um, I wonder while everyone has been talking about the creators, the internet people

are going to replace the media. Is it actually the prediction markets that replace the media, right? Or maybe they don't replace, but they augment in a way that the, the, uh, media can't. Well, then the question becomes is how much money does it take to rig the prediction? So we know, for example, the election, you had to be brain dead to not realize that polls are worthless, right? The political polls are worthless, just like they're about as valuable as fact checkers. Right. And and as I said, my year in review and when I have a discussion with someone and they say, well, I Googled it and you're wrong. And I'm going, you know, how many fucking deep state fact checkers did you have to read to come to that conclusion?

right um how much money would it take to rig the poly markets i i think it is much harder than people think okay i don't know how big the money is i don't know how big the money is there are um i'll give you a good example how much money do you think is being bet on calci for the temperature tomorrow in New York City? Oh my God. I don't know. I would think it would be tiny, but go ahead. I looked yesterday.

It's like 28 million bucks. Wow. That's irrelevant too, right? That's just people who are just betting. One city trying to pick what is the highest temperature of the day, $28 million wagered. so why there's a lot of cities in america why would you do that let me ask you this why would

you bet that is that is i've always wondered why you couldn't get rich sports betting because all you have to be is better than average right well there's um i forget the name of the book with billy walters it's considered the best sports better of all time he wrote a book um you should read it it's fascinating because uh he pretty much called it's a call uh his name is billy walters so you just search billy walters book it'll come up um but uh he basically tells here's how i did it and uh i mean he was a you know quant hedge fund before quant hedge funds right they were crunching the data they built all the technology whatever and then actually part of the the difficulty according to him is how do you put the bets in if you're a hedge fund he's going

you buy the stock and you're right or you're wrong yeah right so there was no market with the betting well he's just like we had people all around the country that literally were calling him and saying okay go bet you know bet three hundred thousand dollars on horse six go right they walk up to the counter and they would do it and so uh you read the book and it you know it's a lot about risk and uh and kind of all that but um it's fascinating when you start there was someone who went to went to a casino and monitored their their roulette wheel maybe and they figured out which one because of the i was sitting on the floor whatever had a bias built into it well they're not perfectly unbiased because it would require perfect symmetry well there's two

there's two uh different stories i've heard the one that uh i know ed thorpe obviously uh beat blackjack by counting cards and then i believe with the roulette uh roulette wheel uh if i remember correctly i think he put something in his shoe that was like a timer and he somehow figured it out and then i can't remember if it's billy walters or somebody else that uh they took the roulette wheels found where they were made ordered them brought them you know to like oh and they analyzed them and they analyzed and realized that there was some you know something was going on with the wheel and uh they had again one percentage you know whatever the thing was that's all you need that's all you need but you put 100 million dollars through it that's all you

needed right yeah you got to put a lot of small bets and just keep banging away on it um i by the way also read at your advice witness to a prosecution what'd you think no it's well today's a good day to talk about it because today we're about to be a witness to a prosecution right I don't even know what Mershon did. But yeah, as you know, it was about it was about Michael Milken and the prosecution of him. And you don't know if it's all true because it was written by a friend. His lawyer. But you you can't a friend slash lawyer, but you can't help but say, boy, that really is yet again. What happens when the long arm of the state capital S decides they're going to get you? And it's a it's a horrifying tale. And and and if the state decides they're going to hurt you, they're going to hurt you. And the laws don't matter that nothing matters. They are going to get you.

Do you want to know what the Trump sentence is live? I do want to know. donald trump was not punished for his criminal conviction in the hush money case the new york judge declined to sentence the president-elect to prison time or impose fines after jury found him guilty of 34 felony counts and then um depending on who you read a number of people say uh at some point he said something about quote cement his status as a convicted felon that'll be overturned at some point, but the key was today that they'll be arguing for years in the court about whether that should be all thrown out. But as I said, I think it was before we

started filming, but as I said to you, what I would have liked to have seen is, is four years of community service. Yeah. Well, he got sentenced to nothing. There's no penalty. There's no fine. Well, four years of community service has humor quality to it. Of course he's going to go do four years of community service. He's going to serve in the White House. That's right. That's exactly right. That's exactly right. That's exactly right. That's why I thought Mershon could actually contribute in an amazingly positive way by saying something about lawfare, some political comment about saying, well, this just is not a direction we should go. Now, he was a douchebag, I think, during the trial, so I wasn't expecting it.

I was just hoping he might. Maybe he did. Maybe he did. We'll read about it later today on Zero Hedge. Before I let you go, can you give us a quick – we've only got about two minutes or so, but can you give us a quick overview? What's your portfolio looking like entering 2025? Well, it doesn't change much. My portfolio changes in decade cycles, so I'm not a trader.

I'm really not a stock picker either. So I try to get big picture ideas right. It's a little Peter Lynch in the sense that he spotted a trick with regional banks. And so he bought the shares of 128 regional banks. Right. And and and so I try to predict sort of big swings. And right now I'm I'm my largest position is variance of cash, you know, two year treasury flavor, short duration. um and you know return about four or five percent sort of thing um and my next biggest position is gold and gold's probably 27 i think and then a smattering of other things i believe when the

selling starts all boats sink right i i everything gets sold when when you when you get into one of these sort of disinflationary sell-offs and i don't think i think you want to be way out of the splash zone. So I think you could own a stock that has a P of 10 and a dividend yield of 3%. And that PE can go to five. And my prediction is based on our discussion of monetary policy and how I think we could be at the end of a four decade, five decade cycle. I believe the age of the V bounce may be over. I think the V bounces were a consequence of this excessive monetary policy because it was always, there's always dip buyers, there's always dip buyers. And I think the best model, even though models never work in this game, the best model would be the

Nikkei. It gets knocked down, it tries to get up, gets knocked down. I think the investor will have his soul ripped out sort of one piece at a time over a long period of time. And I'm hoping that will be offered buying opportunities and i don't worry about two-year treasuries for example so because i don't think if there's an opportunity to buy cheap in six months it's a good one i think it'll be uh i think it'll be like the uh 29 crash and it's now 1930 and you think you're you think you're bargain hunting and you're not and so um so i two-year treasuries are good for me because they they make me think for two years before i do something um i like if i had to go along something right now i think i'd go along platinum it's been dead money for a long time i

think the ev stories bullshit uh it turns out um turns out there's a lot of platinum inside hybrids i think the pure ev stories got a long ways to go and uh and i think the death of the internal combustion engine is premature and so uh platinum i think could make a run it's not it's the only metal on the planet that hasn't done a um but i haven't done it yet just just for the record i'm i haven't i'm waiting waiting for something to say okay now it's the time to move um and um uh i'm hoping in the next five years in 09 i made the mistake i was positive there another halving left. We were at historical average valuation at the bottom. You don't crush everything the way we did and stop at the historical average unless the central bankers put

$30 trillion in. And that's the part I didn't see coming. We had another halving in us if they had let the system run. And if I'm right that they can't do it again because they're now boxed in by inflation um the mistake i made was not asking the question okay we're at fair value you've got another having but how much should you own at fair value i just looked at the having and so i bought a couple tobacco stocks but nothing nothing of consequence um this time i think i will sort of ask the question what should you own at the various stages and try to be a little bit more try to adjust a little more analog fashion my exposure to the different asset classes and so what i'll do is make new mistakes this time and uh and and uh but i i'm if we do a 20

correction 20 doesn't correct anything to call it a correction bothers me if if you go down 20 and then come back in a year the word correct implies if you look it up in merriam-webster implies that you fix something right you didn't fix anything if you go right back up and so to correct we got to drop 50 off this market and if you want to say no we won't do that then say okay so your cash flow is going to be half the norm and that's going to suck balls too right so if you want to fly around in the stratosphere fine but your cash flow is going to suck. And you can't keep growing and growing and growing. There's nothing in the history of markets that says that's sustainable. There's nothing in the history of markets that says I

can predict when it'll stop, but it will stop in my opinion. And I don't want to be near it when it does. That's fair. Where can we send people to find you on the internet? Well, on the internet at David B. Colliman, real time, I'm under my desk half the day. Oh, um, David B column on Twitter. Um, my year in reviews, my pin tweet. Um, as I told you, I was talking to a private equity guy who I'd harassed to no end said, you guys should all burn in hell. I mean, I was really rough on the guy. And, um, and then we chatted and, uh, I said, start reading it. I said, when you get bored, stop reading it. Right. And then I said, if you maintain your interest. It's 250 pages. Keep reading. He was a young guy, so he has some

learning to do. It was clear that he was a prairie dog or in a cubicle somewhere trying to get me to give him money so that he could get rich and I could get poor. David B. Colm on Twitter, 2024, you're in review. What is a fact? There's a hell of a lot of information here. I appreciate it very much. We'll do it again in the future.