The Pomp Podcast - #740 The Ultimate Bitcoin vs. Gold Debate w/ Peter Schiff & Peter McCormack

Episode Date: December 4, 2021

Peter Schiff is the Chief Economist & Global Strategist at EuroPacific Capital. Peter McCormack is the host of the popular Bitcoin podcast "What Bitcoin DId". This is a very special episode with Peter Schiff and Peter McCormick in the same studio together. In this conversation, we discuss the economy and inflation with Peter Schiff. Then Peter McCormack joins the show and we discuss Gold vs. Bitcoin, Bitcoin backed loans, Store of value, and the digital economy. If you enjoyed this conversation, subscribe to my Youtube channel and watch "The Best Business Show" live every weekday from 11am-1pm EST. ======================= Nasdaq-listed BTCS was the first US-public company to secure today’s top layer one protocols. Recently, BTCS launched the beta version of its digital asset analytics dashboard! From across multiple exchanges, the BTCS Data Analytics Dashboard lets you evaluate your entire portfolio’s performance with plans to add year-end reports and yield earning on your crypto through linking to staking pools. Test out the BTCS Data Analytics Dashboard today at BTCS.com.   ======================= Gemini is a leading regulated cryptocurrency exchange, wallet, and custodian that makes it simple and secure to buy, sell, store, and earn bitcoin, ether, and over 40 other cryptocurrencies. Offering industry-leading security, insurance and uptime, Gemini is the go-to trusted platform for beginner and sophisticated investors alike. Open a free account in under 3 minutes at gemini.com/pomp and get $20 of bitcoin after you trade $100 or more within 30 days. ======================= LMAX Digital - the market-leading solution for institutional crypto trading & custodial services - offers clients a regulated, transparent and secure trading environment, together with the deepest pool of crypto liquidity. LMAX Digital is also a primary price discovery venue, streaming real-time market data to the industry’s leading analytics platforms. LMAX Digital - secure, liquid, trusted. Learn more at LMAXdigital.com/pomp =======================

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Peter Schiff is the chief economist and global strategist at Euro Pacific Capital. Peter McCormick is the host of the popular Bitcoin podcast, What Bitcoin Did. In this conversation, we discuss Bitcoin, gold, macroeconomics, utilities, store of value, social security, and much, much more. I really enjoyed this conversation, and I hope you do as well. Before we get into this episode, though, I want to quickly talk about our sponsors. First up is NASDAQ-listed BTCS. It's the first U.S. public company to secure many of the top

Layer 1 protocols. This quarter, BTCS just launched the beta version of a new digital asset analytics dashboard. From across multiple exchanges, the BTCS data analytics dashboard lets you evaluate your entire portfolio's performance with plans to enable year-end reports and yield earning on your crypto by linking to BTCS staking pools. This groundbreaking dashboard is currently in beta mode. Test out the BTCS data analytics dashboard now by visiting btcs.com. Again, go to btcs.com today to check out that brand new BTCS data analytics dashboard. Let me know what you think once you're there to check it out. Next up is Gemini. Gemini is a leading regulated cryptocurrency exchange, a wallet, and a custodian that makes it simple and secure to buy, sell,

store, and earn Bitcoin, Ether, and over 40 other cryptocurrencies. They offer industry-leading security, insurance, and uptime. Gemini is the go-to trusted platform for beginner and sophisticated investors alike. You can open a free account in under three minutes at Gemini.com and get $20 of Bitcoin after you trade $100 or more within 30 days. Again, Gemini, a leading regulated crypto exchange, wallet, and custodian. It was founded by Cameron and Tyler Winklevoss and have done a fantastic job building a business. You can open a free account in under three minutes

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through volatility spikes. You may have never heard of LMAX Digital, but that's because you're not an institution. They don't service retail. lmax digital only serves institutional clients they leverage lmax groups liquidity relationships and ultra low latency technology lmax digital is the market leading solution for institutional crypto trading and custodial services they feature a central limit order book that streams spot bitcoin ether litecoin bitcoin cash and it's all paired with us dollars euro and yen lmax digital

they're secure they're liquid and they are trusted learn more at lmax digital.com slash pomp. Again, lmaxdigital.com slash pomp. All right, let's get in this episode with Peter and Peter. I hope you guys enjoy it. 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. I apologize for everything that's going to happen today. We have Peter Schiff here in the studio. We've got Joe and

John as well. Peter McCormick is on his way. He's stuck in traffic, but he'll be here shortly. I don't really have much else to do. Let's just start. What are you doing in Miami? Well, what's everybody doing in Miami? Well, other people are living here. Yeah. All right. That's why I'm here. Have you bought any art yet? No. I said no one will take my gold bars for them i'm lugging them around you're getting heavy no i'm here i want to buy some nfts really of course not do you really not listen some bitcoin art i brought it with me yeah that's right it's right here in fact i put it it's all over the table it's just like real art except that you can't

see it you can't touch it it has no actual value no real utility do you really sell it to you i i have a serious question do you own any bitcoin for real no well i own some i just can't get at it why well because i don't have my password you said you realize that sounds but i don't know yes but i don't even have a full bitcoin there it's only like a third of a bitcoin okay so good thing you didn't send me that hundred dollars so it's 20 000 so it's 20 000 for the bitcoin yeah but you know that's the wallet you were supposed to send me a hundred dollars worth of bitcoin till you never did which is just as well because you know it's lost okay what what would it take to get you to buy some bitcoin well why would i buy bitcoin though no no you didn't answer the

question what would it take to get you to buy some bitcoin well i guess how far would gold gave me some money under the with the condition that i had to use it to buy bitcoin i guess i'd have to buy bitcoin because i'm an honorable person so if it was your money i guess i would buy it i don't i don't want to buy with my own money if and when bitcoin passes gold's market cap will you buy some well a i don't think it's ever gonna pass gold's market cap but you know that's a good starting point for a conversation because everybody always wants to look at the market cap of gold and just assume that bitcoin is going to take that market cap but you know a good chunk of that market cap probably half of it has to do with gold's use in jewelry no wrong

wrong yes it is seven percent no it's not you want to bet you want to bet what percent what percent of gold's market cap is held by investors my guess my guess is a pretty big percentage no it's about 20 percent you know so bitcoin already almost has that market cap right because it can't replace gold in industry it can't replace gold in jewelry gold gold market cap is about what 13 trillion okay so according to this hold on according to this distribution of gold demand worldwide by sector in 2020 this is uh i'm talking about the actual hold on it says jewelry is 36 percent investment is 46 central banks is eight and technology is eight percent yeah but i'm talking about but the market cap includes all the gold that's above ground okay right that includes

you know the gold in everybody's jewelry there's a lot of gold that's that's held in jewelry that's a good chunk of the market cap. So Bitcoin can't take that market cap. You can't make any jewelry out of Bitcoin. I mean, I think that Bitcoin's market cap is already close to gold's when it comes to individual private ownership for investment purposes. I'm not counting central banks. So how much do you think is investment demand for gold? 50%? No, I think about 20% of the the above ground gold that's part of the market like two trillion yeah two two yeah two two and a half trillion and that's kind of close to the market cap for bitcoin already well that would be bitcoin would have to double to get there no no lesson but if you take coins out

bitcoins out one trillion dollars all right but if you take all the cryptos yeah ether and all the rest of the crap but those aren't trying to compete well sure they are with gold no with bitcoin they're trying to do other things no they're not yeah they're competing with bitcoin for people who want to gamble on crypto tokens do you think that most people are buying bitcoin because they're trying to gamble of course they're buying bitcoin because they think it's going to a hundred thousand or they think it's going to a million that's why they're buying it but how much of your portfolio is in stocks like 50 80 well my portfolio well my stock portfolio is all stocks but like your financial portfolio what percentage is like just all equities in general well that's

Well, I mean, if you exclude real estate that I own and private businesses, if you look at like how my, you know. Like liquid portfolio. Yeah, I'm mostly in stocks. Okay. The vast majority of what I have is in common stocks. And so when you buy it, equity, you're buying it because you think that it's going to go up in value against the dollar. No, mostly I'm buying companies that I think are undervalued. They pay good dividends to me.

I want to get out of paper. I don't want to own bonds because I think bonds are going to lose value. You sold them all. Well, I didn't really sell my bonds because I never really owned any. I mean, I had some foreign bonds, but I'm almost all in non-U.S. equities. And a lot of those equities are mining companies. And that part of my portfolio has not been performing well. Gold stocks have really gotten hit.

All right, I want to give you some softballs. So I'm going to let you do what you do best. Ready? First softball. They say inflation is 6.2%. They've been saying that it's transitory. We now have the retirement of the word transitory. Like literally they should have held an award ceremony, put it in the Hall of Fame.

It's retired. What do you think about them not wanting to use the word transitory anymore? Does that mean that it's permanent or does that mean that they just don't want to talk about it anymore? Well, I think they're tired of trying to obfuscate as to what they meant. I mean, I think initially when they said transitory, they meant transitory. But then when it turned out not to be transitory, they had to kind of redefine the word and kind of, you know, to try to save face. But at this point, they've twisted it into such a pretzel that I think they just want to walk away from it because they really looked ridiculous in the face of overwhelming evidence that inflation was not transitory to try to claim that it was. But I still think the methodology that we're using today to calculate inflation is deeply flawed.

And when they contrast what's happening today to the 1970s, they never talk about the fact that the CPI that exists today is nothing like the one that existed back in the 1970s. And this is cost of living versus cost of goods. Yes. I mean, basically, now it's the cost of surviving. I mean, by today's methodology, look, it doesn't matter if you're eating filet mignon or dog food. As long as you're eating, then you got nothing to complain about, right? They don't really look at the quality, even though they claim to when they have substitution or hedonics. But that's a savage comment.

The whole thing is rigged now. But if we were measuring prices today and we just use the same CPI that they used back then, I think the inflation in 2021 was as bad, if not worse, than any single year of the 1970s. So what percentage would that be? I don't know, probably 13, 14, 15 percent. Some 15, but over 10. Yeah, I mean, if you look at import-export prices, those numbers are more real. And that's about what you see, because there they're actually taking a look at how much are the goods that we're importing costing? What are the goods that we're exporting? It's just apples to apples.

And you can actually see the prices, although anecdotally, most of the price increases that people point out to me. I get a lot of emails and people show me, hey, this is what I just bought. And here are the exact same thing I bought last year or six months ago. And you look at the price increases. They're much bigger than six percent. OK, second thing is that we now have Jerome Powell as the Fed Reserve chairman going to be renominated and continue. Good decision, bad decision, or would you have done something different if you were President Schiff? Well, there probably would be no Fed if I was. I would have already gotten rid of it.

But I predicted on my podcast that Biden would take the coward's way out and renominate a Powell. I mean, why is it the coward's way out? Well, you know, you don't want to go out on a limb and put somebody else in there who's your person, because then if anything goes wrong, it's your fault. Right. You just you just leave the guy there that's there because, hey, everybody wants him there. And then if something goes wrong, hey, it's not my fault. Look, he's not my guy. Trump appointed him and, you know, the Republicans wanted me to keep him. And so it's easier for him than going out on a limb, because if if the economy does well or Powell does a good job, then he gets credit for reappointing him. But to go out on left field and go for a Brainerd or somebody else and then something goes wrong.

You know what? Why? I mean, Trump kind of had to get rid of Yellen because he spent his whole campaign bashing Yellen, basically for doing exactly what he then bashed Powell for not doing until Powell got his mind right and started doing exactly what Trump criticized Yellen for doing. But look, he's done a lousy job. I mean, if you want to look at the Fed's, you know, mandate of price stability, we clearly don't have it. But, you know, I think really what the Fed's job is, as far as Biden is concerned, is helping me get reelected and kicking the can down the road

until the next election. Do you think anyone would do something different? What would you have done if you were in that seat? Well, you know, what I would do, I would let the markets know that the Fed is no longer going to be setting interest rates, that the market was going to do that, and we were going to start liquidating

our holdings of U.S. Treasury. And of course, in so doing, there would be massive losses uh that and and you know the bill goes to the u.s taxpayer you know as the fed unwinds its balance sheet any losses are ious to the u.s taxpayer because the u.s government has to make the fed whole um for that um but also you know i would let the government know that the fed is no longer in the business of monetizing government debt and that if you want your bill back better you better figure out how you're going to pay for it how okay this is what i want to talk about as well is uh they say it's cost zero dollars is that bullshit of course it's bullshit

i mean they always say that because their assumptions are ludicrous like break it down for me well the revenue assumptions they're not going to get the revenue a lot of the revenue is supposedly going to come from extra irs agents you know getting the rich to pay their fair share well you know they're not going to get much more money out of the rich uh there's not that many rich people other than you crypto guys um but and you don't pay taxes anyway you never sell you're so salty you're so salty you guys never sell so they're not getting any you'd be one of the richest people in the world if you bought bitcoin when you first heard about it keep going but um but they're not going to get the revenue i mean they're obviously mainly going to target

the middle class that's where the extra irs enforcement is going but it's hard to get blood from a stone so i don't think they're going to get a lot of revenue meanwhile all these new programs are going to cost so much more than they think i mean first of all they act as if the programs are going to go away in you know five years because they don't want to count the spending in the out years although we all know that these programs never go away once they're there they're there forever i mean we're still dealing with temporary programs from the second world war you know the war ended well why are these temporary programs still in effect right they never go away there's an old saying i think it was milton friedman there's nothing as permanent

as a temporary government program. So to pretend that these programs are going to sunset is nonsense. But also, they have grossly underestimated the cost because the government doesn't understand moral hazard. They don't understand what happens. So part of the Build Back Better is everybody gets free preschool. Well, the cost of preschool is going to go way up once the government makes it free

because now the demand for preschool goes way up, and now the preschools start jacking up their tuition because they know the government's paying. It's like the defense industry. The defense industry says, oh, you're going to pay us all this money? We're just going to keep increasing the cost of it to you because we know you've got a ton of money. It's just like, look what government did to college tuition.

Before the government started subsidizing college tuition and guaranteeing loans, college tuition was cheap. Government gets involved, and it costs a fortune. So they're going to end up spending a lot more on preschool than they think, but I think the biggest one is going to be if it stays in there because the Senate might get rid of it, but that is the paid family medical leave because everyone's going to take that. They just assume that, well, only the people that actually have a medical emergency are going to ask for their four-week paid vacation. No. I mean, didn't they learn their lesson from the PPP or the extended unemployment benefits? If you tell an American that they can have a four-week paid vacation at 90% of salary every single year and all they have to do is claim they have to take care of a sick friend or family member, you don't think they're going to say that that's what they have to do?

My brother just got sick. Damn. They're going to take it. Every single one of them will take it. You tell me everybody that had an emotional support animal on an airplane actually needed that animal for emotional support? are you peter you're ruthless you're going after the animals no it's the people no but people look people try to qualify for these programs everyone's going to want to take a month off every summer so oh my god my my uncle needs my help my kid needs my help i'm not feeling

well i'm depressed he just happens to live in italy i gotta go to this everybody's gonna suddenly have a sick relative in the summer yeah all right so when this happens uh what is the impact the programs cost more than they think and then they can't get as much revenue as they think so what is the impact in your opinion uh if this gets passed and implemented well it's just more inflation you know because the fed has to print more money that's why the fed is talking about printing less money that's tapering but they're going to have to print more money uh to fund these uh deficits otherwise interest rates go way up and what happens if interest rates go way up well the deficits actually get bigger

because now the government has to spend even more interest i mean even more to pay the interest on the debt that it already has not to mention the new debt that's being incurred but also when interest rates go up it hurts the bubble economy because now everybody has to pay higher interest so you can't spend more money on other things because your your interest rates went up your adjustable rate mortgage went up. Your credit card interest rates went up. People can buy less stuff on credit because car loans are more expensive. So this whole bubble economy starts to unravel and we go towards recession or into recession. And when that happens, government tax receipts fall, more spending on unemployment. So the deficits get even bigger. So the Fed has no

choice if it's going to keep everything going. But to expand the QE program, print even more money, create even more inflation and and so the price increases that we're experiencing now you know are just a small taste of what we see will we see 10 inflation in the official cpi number in the united states in the next three years you think i think we will unless they rig the numbers again i mean i wouldn't put it past them but assuming they leave the cpi the way it is probably we might see 10 next year is inflation going to get worse in the coming year well it has to get worse and and in fact and again when you're talking about price increases you're measuring the consequence of inflation the inflation is the expansion of the money supply

and we know money supply is going to keep expanding they're about to raise the debt ceiling right so we can keep uh going deeper in the debt you know i always laugh whenever they talk about it janet yellen and you know when she testified the other day she said six times the government's going to be bankrupt this year the funny thing is she said we have to raise the debt ceiling because it's important that we pay our bills in full on time. Well, if we paid our bills in full on time, we'd have no debt, right? The reason we have a debt

is because we don't pay our bills at all. We borrow money so that we don't have to pay our bills. And what Janet Yellen really means is that we need to raise the debt ceiling because we can't pay our bills. We can't pay our bills. We have to take on more debt. We have to take on more debt.

Can I ask a serious question? And I'm scared to ask you this because I'm going to give you like all the ammunition in the world. if i am taking money from one investor or lender to pay back the original yes lender well there's two ways to look at it it's called refinancing people doing mortgages all the time right it's also called a ponzi scheme if they're investors that i'm not necessarily refinancing i'm literally just playing like a yes it is a ponzi scheme that's why bernie madoff said that

the united states was running the world's biggest ponzi scheme and that what he did was nothing compared to that and i used to joke about his defense because yep no but he just mentioned it like hey come on i mean like he wasn't saying he's a days ago but this was the thing did he really say that was really yes yes and then the new york times wrote this piece and they mentioned it and they said well you know bernie madoff doesn't have any credibility right so and i used to joke and say wait a minute wait a minute he's got credibility on one thing yeah So if he says, yes, exactly. That's why I used to joke.

We should have made him secretary of the treasury. The whole nature of what we were doing, you know, that's pretty good. Yeah. And you know, because, but the thing is the government, Janet Yellen, when she tells everybody that if we don't raise the debt ceiling, we're going to default, that's an admission. It's a Ponzi scheme, right? bernie madoff would never be dumb enough to admit he was running a ponzi scheme right that's ponzi

101 you keep it quiet right you don't tell everybody it's a ponzi scheme because they're not gonna okay all right so that's the debt let's go to social security because one of the things that i'm very interested in before you do that i wanted to i forgot to finish answering the question as to why the inflation is going to be worse on a cpi look at um producer prices OK. Producer prices 2021 up more than consumer prices. So businesses were seeing their prices costs rise more than what they passed on to their customers. Now, why was that? It's because a lot of businesses were reluctant to raise prices. They're worried about losing sales to competitors and they were told that it's all transitory.

OK, we'll take a hit for a few months. It's transitory. We don't want to reprice everything and then have to change the prices. So businesses kind of absorbed the rising prices and took a hit in their margins. But I think by 2021 or 2022, rather, a lot of these businesses are going to throw in the towel and they're going to say, you know what, we got to pass this on. It's not temporary. and i think you're going to see businesses much more willing to raise prices in 2022 than they were in 2021 and is this where you see corporate executives on their uh earnings calls being like oh we raised prices and like the customers liked it like it was basically like

that's basically what people have said they've been like oh we raised prices and the market accepted it right they're not saying they they liked it they're just saying they accepted our higher prices they tolerated it and therefore now they feel emboldened to do more of it because they've seen like hey we did a little bit we raised three or four percent nobody left actually in some cases demands even higher and so if we raise it five or six percent from here then if nobody leaves we can just continue to play this game yeah i mean they're going to raise prices as much as they can i mean in general businesses want to maximize profits and so the reason you don't keep raising prices is eventually you lose sales. But if all of your competitors are facing

the same cost problems that you have, when you raise prices, other people have to raise prices too. What ultimately happens though, as you really start to raise prices significantly, it does impact demand because not everybody can afford the higher prices. And then what happens is businesses end up reducing capacity so they can achieve their profitability at a lower scale. and then prices really start to go up because now supply is coming down because fewer businesses are providing these products or services uh and and you really get the spiral but what's driving it all is the money it's more money being created i mean they keep talking about the supply side problems i was you know just getting a kick out of pal's testimony because did you watch was that

your super bowl were you sitting there and you you had a beer and like some steak and a pizza I didn't have refreshments or anything, but I was watching. But Powell was like, well, because someone had said to him, well, what did you get wrong? You know, now that he's saying it's not transitory. And Powell said, well, you know, we got one thing wrong, and that was this supply problem, the supply. I mean, and he said, but, you know, in fairness, nobody could have predicted this. This was crazy. It came out of left field.

I mean, nobody could have realized that the effect of the pandemic would have been like supply chain bottlenecks. And I'm like, what is this guy, serious? I mean, so you basically shut down the entire economy, right? All these factories close. You furlough all the workers. You literally stop making stuff. And now you're surprised that there's a shortage of stuff? You're not making it anymore.

How could there not be a supply chain problem? I pointed it out on my podcast in March of 2020. As soon as this happened, I said, I don't know why people are talking about COVID as being deflationary. This is inflation on steroids because not only are we flooding the world with money, we're stopping the production of goods. I mean, we're having less stuff and more money to buy it. This is like, you know, double inflation. So this was obvious.

Inflation and inflation. Well, you know, inflation is more money and chasing less stuff. Well, when factories shut down, they're not producing stuff. How do new variants play into this? Are they going to keep this game going? Are they going to keep doing it? Well, I mean, they're looking for excuses to continue these programs. But the point I want to finish.

What happens when shift variants show up? Let me finish making the point that when we shut the economy down, right, and people stopped working, they needed to stop spending. That was the right thing to do. Hey, you're no longer working. You're not producing goods and services. So you've got to stop consuming because you're not producing. Correct.

So we but the idiots in Washington said, hey, we want to make sure that these unemployed people keep spending on what we're not making anything. But they gave them all this money anyway so that they could spend even though they weren't productive. So productivity fell, but they still had cash because they got handed free money. Yes. And they went and just spent a lot of that cash went into assets, though, not consumer goods. Well, they went both places. Yeah, because some I mean, in fact, some of the people that got stimulus money went right to the Robin Hood and bought stocks. Some people went and bought crypto with it.

But look at the trade deficits. They skyrocketed at all-time record highs. We started buying all these goods that people were still making in other countries where they were still going to work. But all of these things were very predictable, and it was a misguided policy. The Fed did the opposite of what it should have done. We should have contracted monetary policy supply along with the contraction of the economy. But we didn't want to do that. We didn't have the stomach for that.

And of course, we that the politicians could not have ordered people to go home if they didn't also say, oh, by the way, we'll give you the same money that you would have earned if the politicians said, hey, you got to you can't go to work. Oh, and by the way, you don't have any income. People would have said, screw that. I'm going to work. So did they have they had to do it, but it's bad because of the impact. It was horrible economic policy. And the obvious consequence is this massive increase in prices that we're seeing the supply shortages. But Powell acted as if nobody could have predicted this when it was the most obvious thing that only an idiot could have missed it. And the question is, if the Fed is so incompetent that they don't see that when you stop production that you don't have supply, if they can't see that, what else are they missing? What are the other obvious massive problems looming that the Fed is clueless about? all right so when shift variant or some other variant shows up are they going to shut down the

economy or is that now too politically sensitive and so they're going to basically do everything they cannot to shut it down and they're going to use stimulus to try to keep everything going or like how do you look at the future i don't know if they're going to try to shut everything down again i do know that there are a lot of you know factions that that like to shut down i mean i'm surprised the teachers union hasn't come out and said oh omicron we can't go to school we gotta send my paychecks uh you know i'm doing homeschooling again or whatever um where they did it online but a lot of people don't like working in fact most people don't like working they like getting paid so if they can get paid without working well that's what they choose to do and

they can use uh coronavirus as the excuse ah look who's here peter mccormick is now in the building yeah you know ladies and gentlemen yeah so you know we were talking about ponzi's yeah we're talking about ponzi schemes before right sorry peter didn't know that we were talking about ponzi schemes and that's a good segue into bitcoin although did you was that you trying to get an reaction is that a joke no actually bitcoin is more of a pyramid than a ponzi i can't explain the difference if you walk you like that picture yeah you like that picture oh you got you carry that around in your wallet it's a bit big for my wallet it's a bit we're digital over we don't actually have wallets we have digital wallets so you'd

have your digital money for your make-believe money yeah yeah well hey yeah make-believe money's going pretty well all right so i got a couple of questions while peter gets set up over there first thing that i i want to understand is social security this thing is done it's over or they're going to figure out some way out of it and be able to actually give people social security after 2032 or 2034 social security is the original government ponzi this is even before it started operating the national debt as a ponzi but uh social security is an intergenerational ponzi right because the the people who got in early the people that you know started um paid into social security hardly any money because initially it was a one percent tax uh one percent of wages

and the self-employed didn't even have to pay. I mean, they figured if you're smart enough to be self-employed, you can save for yourself. So if you were self-employed, you weren't even required to pay in. So it was very small. And the early people that got in ended up as huge winners.

This woman, Ima Fuller, is the first person to ever get social security. She lived to 100. I think she only paid taxes for like one year and then she collected for like 50 years or whatever. So she made out like a bandit because she was the first one in the Ponzi. uh but at this point you know you have this whole generation the baby boom there's no chance that

the baby boom is going to get out from social security what they put in um it's just impossible because they never funded it like real insurance it wasn't like the government took the social security contributions and set them aside and invested them they just spent all the money and they replaced it with an iou from the u.s government of the treasury uh but it's a classic ponzi but even now the social security system no longer collects as much in taxes as it's paying out in benefits right now yeah so they're already drawing down these phony trust funds by running additional deficits because the government used to be able to borrow from these so-called trust funds to help fund the deficit but now the trust funds themselves are borrowing because labor force

participation has collapsed a lot of people have retired early so they're not paying into social security anymore but you have all these people who are who are paying out and in fact now that the the cpi is rising at a higher pace you know they have to keep giving raises now on social security so this thing is is rapidly uh running for a collapse but it's all being financed by the fed right now that's the only reason that the whole system hasn't imploded is because we're printing the money to pay the benefits. All right. Have you ever met Peter McCormick in person?

No, I think I'd remember all his tattoos. All right. How are you, Peter? Peter's your biggest fan. You both named Peter. Your moms both are just as smart as each other's moms because she both named you guys Peter. Yeah, he's got a good name.

All right, good name. That's a good common ground. I think that's where the common ground ends. Did you play tennis this morning? No, I didn't play tennis. Common ground's over now. No, I just thought you came from tennis. No, I'm just wearing blue and white and red.

It's patriotic colors, but, you know, I'm here in Florida. I'm on vacation. What do you think about his picture? You're never on vacation. Yeah, I know, and you got me down here. No, I only vacation when I'm in the United States. I work in Puerto Rico. Oh, okay.

That's smart. Good save. I spent 300 days in Florida this year. Yeah, I'm going to do 300 in Puerto Rico. Oh, perfect. I'm going to do 300 in Bedford. What questions do you have for Peter? I know you've got a number of questions,

and I feel great that I've now corralled both of you into the same room staring at each other while you also have that picture of Schiff next to you. Any questions? I don't know. I thought you were going to, like... Listen, can your mind be changed? Oh, sure, about a lot of things.

Can your mind be changed on Bitcoin? Are you in a position now... I don't know if I can get any more bearish than I already am, but, I mean, I suppose... Like, is there any argument where you would, you know, If you heard a sound enough argument, would you be like, yeah, do you know what? I might be wrong. Well, I just, I mean, I didn't know there was an argument I haven't heard yet, though.

I mean, that's the problem. I think I've heard all the arguments. What is the thing that if you saw it happen, you'd be like, okay, fine. Bitcoin's going to at least be around. Forget the competition with gold. Just Bitcoin is actually have value. What is the thing that you would look and be like, okay, damn, that works? Well, you know, we're no closer to that, you know, than when we first started.

I mean, all I see with Bitcoin is people buying it, thinking that the price is going to go up. And, you know, if the government bought Bitcoin and put in the Federal Reserve balance sheet, would you then say, oh, you know what, maybe I'm wrong? Well, I mean, governments do stupid things. I don't expect them to be that stupid. So I don't think they did it. Just say they were really stupid and they did it. Would that change your mind? I don't think so.

I mean, if they just started buying Bitcoin, too, I'd be surprised. But, you know, I guess that'd be great for you guys. You could sell to the government if they were dumb enough to buy it. But, you know, right now, I think the latest pump is to get high profile people, whether it's the mayor of Miami or some celebrity or football player to say, oh, I want to get paid in Bitcoin. But nobody's actually getting paid in Bitcoin. They're not. Why not? Well, they're not accepting Bitcoin denominated salaries.

salaries. They're saying, hey, take my dollar salary that you were about to pay me and convert it to Bitcoin and send it to me. And then when I get the Bitcoin, well, I'll convert it back to dollars so I can buy the things that I actually need. I think it's all another PR gimmick to try to get people to think, oh, see, Bitcoin is being used as money because Odell Beckham wants to get paid his salary in Bitcoin. The leagues don't allow them to get paid in Bitcoin. Well, they're not i mean anybody like i like you could pay people in peach pits i mean you could you could convert their dollars to whatever the hell they want you know but it's all uh publicity stunt um you know to try to get people to buy bitcoin what do you think about people getting paid in

bitcoin well i get paid in bitcoin and i don't convert at all no but you get paid by who sponsors sponsors pay me in bitcoin but do you negotiate the rates in bitcoin or is it in what what you're in australia the uk okay okay so it's pound so but i use dollar as my unit of account all right so when you when you have an advertiser uh-huh do you have the fixed dollar price for ads yeah i tell them the price of dollars and i ask them if they want to pay me in bitcoin and right but you're not using bitcoin as the unit of account but i wouldn't use gold as a unit of account if i got paid in gold but no you could yes you could but i wouldn't i would still use dollars obviously you'll say pay me in gold but here's but why not i mean because gold is pretty

stable i mean i i mean i have no problem down no no but this is this is an important point so peter i've heard you hold on a second let's make dollars what about other currencies hold on hold on hold on hold on hold on hold on hold on this is an important point there's three kind of properties to money right there's store value medium of exchange and unit of account correct i think and also let me point out because people overlook this one but part of the um the store value is also a medium of deferred payment and and that's very important uh as a store of value people don't talk about it it means basically that i can loan you money and then you can pay me back and the the loan when you repay me is the same purchasing power as when i made the loan that's part of the

store of value but lending is very important to an economy and you need to have a money that can be utilized as loans you know now nobody is going to take out a bitcoin mortgage i mean actually they are well but you're so so you're going to buy a house and you're going to say i want you to loan me 10 bitcoin no and i'm going to pay you back 10 bitcoin over 30 years no no one's doing it hold on no one knows what the hell bitcoin is going to be worth hold on so let peter explain what the mortgages are right now and then it's a different thing than what you're talking about but they're calling it a bitcoin but then it's not a real if it it's not a real bitcoin mortgage if you're not amortizing bitcoin i know okay okay so i allow sponsors to pay me in

bitcoin uh anyone wants to pay me in bitcoin they can but the reason i don't price my services in bitcoin is my accounts my accounts are done in pounds or dollars whatever yeah actual currency yeah so it's well we can go back to that but the reason it's done that is because my accounts have to be reported to the government in uh pounds so that's the reason it's dumb but i choose to accept bitcoin and hold it in bitcoin as part of my treasury as i could with gold your argument there is exactly the same there's no difference no but bear with me just but just just as an example i've just bought a football team that team is going to run dual accounts is going to run a pound account and a bitcoin account we're going to run them side by side and what this says to

me is that we're in this transitionary period where bitcoin isn't a useful unit of account because it is volatile against the pound. And we have to report our accounts in the pound. But over time, the transition is happening, which is why I'm moving with my new business to have dual accounts. We'll run one in Bitcoin and one in pounds. But either way,

I don't see this as an argument against Bitcoin. It's still used. It's still the same argument as gold. Now, I look at when you're using Bitcoin now in a transaction, it is more of a barter transaction than a monetary transaction. Whereas when you say, you know what, I will trade you this advertising service that you want for the Bitcoin that you have that I want, and the Bitcoin is more a good, and you're basically going back to barter where you're bartering for Bitcoin.

But it would be the same argument for gold. No, it wouldn't. But I would never price my business in gold because gold is volatile against the pound. It's exactly the same reason. Different levels of volatility, but it's exactly the same argument. Right. Well, when we were on a gold standard, that's what everybody did, right? Because every currency was pegged to gold. So even if you priced in a currency, you priced in gold.

And in fact, a lot of contracts had gold clauses just in case there was ever a problem that you could enforce the payment in gold if the government screwed up the currency. um but even today even if you weren't on a gold standard gold is stable enough uh over short and longer periods of time that you can uh price products and services in gold all right but hold on but you could wait one second more companies right now globally will be pricing in bitcoin than with gold no nobody is pricing in bitcoin no they are they are people pricing in bitcoin various people you have to change the price every 10 minutes wait a second every hour second wait a second hold on i don't want to talk about gold for a second because you hold some gold not a ton of gold uh i'm not against you also own a bunch of equities right

so rather than compete bitcoin versus gold what i want to talk about is bitcoin specifically and i think that one of the key things that you're talking about is the pricing of the asset the unit of account in bitcoin right if he says hey uh you want to buy something from me you want to buy a service a good whatever it's priced in bitcoin if you're thinking of it in terms of pounds or dollars yes it moves right and sometimes it's not very volatile sometimes it's very very volatile but if instead you actually are denominating your balance sheet let's say i have a business i denominated in bitcoin he prices something in bitcoin when i go to buy it i don't think about what the u.s dollar value is i just think of bitcoin right very similar yeah you can

think that very similar to the u.s dollar where you i and peter and my brothers all hold dollars the dollar has been incredibly volatile over the last 18 months but we don't think of it as volatile because we don't think of an exchange price with the dollar because the goods are priced in dollars and our balance sheets we think of in terms of dollars so it's actually the same exact thing the difference is that there's a mismatch between if your balance sheets in dollars his balance sheets in bitcoin that's where there's volatility but it's really the same thing dollar has been falling aggressively over the last 18 months right the dollar well not against other fiat currencies it's relatively stable against good and yes i mean the purchasing power of the dollar

has declined the purchasing power of pretty much every currency has declined um normally you would see that represented in gold and i think the reason you're not over this time period is because you know first the fed was saying there is no inflation then they were saying it's transitory Now they're acknowledging that it's not, but the market still expects the Fed to fight inflation successfully. And so that's what's keeping a lot of pressure on gold, the idea that inflation is going to go away because the Fed is going to kill it. But nobody has figured out that it's impossible because if the Fed were to actually raise rates high enough to fight inflation, the economy would tank. We'd have a financial crisis and they would be right back to the printing presses. The idea that they could fight inflation with just a half a percent rate hike, you know, in 2022 is ludicrous.

There's no way you can stop inflation with those tiny rate hikes. You know, I mean, if you could do it, then Volcker would have done it in 1980. Wouldn't have gone up to 20 percent. But that's where they went. I mean, you can't tame this kind of inflation with those little baby rate hikes, especially when you're starting from zero, right, going from zero to a half a percent. What is that going to do about six or seven percent inflation? That's probably more like, you know, 15 percent inflation. But the bigger problem in Bitcoin, forgetting about unit of account, medium of exchange,

it's the basic premise that it's a store of value, which it 100 percent can never be because you cannot be a store of value unless you have value to store. right and and so are you are you tricking us no do you mean by that all right so why is gold a store of value right well gold is a valuable metal right that is used for all sorts of things right technology and jewelry a lot of things whatever it's a metal just like copper or nickel i mean you know you could you know copper is a store of value too It's just hard to store it because it's bulkier. But why gold is the store of value is because gold, I can use my gold today or I can hold it in a bar and somebody else can use it tomorrow.

Whether it's in five years, 10 years, 100 years, that gold is not going anywhere. It's not going to rust. It's not going to decay. Right. It's going to stay around. so the value of gold is stored it's and like here i have gold in my watch is it real yes now i mean you prove it you can melt you can melt this down and and get the gold and do something else so that you would it'd be stupid to melt the watch down because it's worth more as a watch but

at some point let's say it wasn't no one gave a damn about watches but they just needed gold you could melt it down and the gold is exactly the same as it was before it went into my watch what if we discover more gold let me let me just finish so gold represents all of the uses for gold until the end of time discounted to today because you can use it over and over and over again right so so what you're saying here is it has industrial use it has real use it has real value to human beings and not just industrial use right i mean i'm not using it in industry while i'm wearing it okay but you go around you know miami go out tonight look at all the women look at all the men and look at how much gold they've got right they're all wearing it um around their necks

around their wrists right i mean on their fingers right people like to adorn themselves with gold um they've been doing that for thousands of years and i i don't think it's going to stop i mean outside of uh people in india and yourself i don't know anyone who wears gold anymore what well as i said go out tonight and check take a take a look at this anyway i get your point so the point you're you're making is gold has value because it has industrial use has value as for in don't keep saying industry okay industry is one use but you know but people use it right okay so i've got an answer just just to interject so to give you a point is that we're talking about uh technology innovation here so whilst you regard gold as money because it is money but it's store of value and

can also has these other uses you are not recognizing that bitcoin also has other uses but Bitcoin is a technical innovation that provides services outside of it just being a store of value. Bear with me. So just as an example, right now, you can send synthetic dollars across the Bitcoin network rails anywhere in the world instantly and for free. It's out-innovated every single financial network in the world. No other financial network. But what does that have to do with the value of a single Bitcoin? Bear with me.

That allows it to do it. So it has a use case. So there's a reason to own it, which gives it a price. There's supply and demand on owning those Satoshis to be able to move the value around the world. Well, how many Satoshis do you need to own? Can I just have one? Do I get access to that network with just one Satoshi? So why do I need any more than one?

Because it has to equate to the exchange rate of what the Bitcoin is at that moment, which also is something that people want as a store of value. But just bear with me. But what value are they storing? What's the value? What is the inherent value of a Bitcoin? There's no inherent value in everything.

We've all agreed on that. No, no, no. Yes, there is. No, there isn't. There is market value for it. no no market value is price yes everything has i'm not arguing that bitcoin doesn't have a price it does obviously it has a price i'm saying it doesn't have any underlying value to justify okay so here so here's what i'm gonna say price is based on speculation do we all agree that commodities in general have some value whether there's a lot of value or a lower value okay yes what do you

think is the most valuable commodity in the world today well i'm not sure what the most valuable one is okay but gong's a gong's a very valuable one i'm sure that the most valuable commodity in today's economy is computing power would you would you argue against that well i don't know if you would define computing power as a commodity but i we have now hit hold on we have now hit what i think is the biggest difference between the way that you look at the world and the way that we probably look at the world which is that in a analog economy which we've lived in for centuries physical commodities are by far the most valuable when you transition into a digital economy which right now i would say we're probably 50 50 maybe i'd have to look at the numbers but

we're probably 50 analog 50 digital but over time more and more of the economy will move online become more virtual etc so the computing power as a commodity will become more valuable as we continue that doesn't mean that bitcoin is just a waste of computing power you don't get any computing power when you own bitcoin hold on when you think about computing power as a commodity now when you look at the bitcoin network and bitcoin as an asset right remember bitcoiners weren't exactly uh the best marketers when they named the network the payment rails bitcoin and they also named the asset bitcoin as well but you can spend bitcoin across the bitcoin network but when somebody says what is bitcoin backed by if they had asked what dollars were backed by before

we came off the gold standard you would say gold right the u.s dollar was backed by a physical commodity in terms of gold and bitcoin is back technically the u.s dollar was gold okay it was actually defined legally as a specific weight of gold or silver it was and then what happened was we had notes federal reserve notes that were backed by dollars which were made of gold so the federal reserve note wasn't a dollar that's why they actually said we'll pay to the bearer on-demand dollars because they were paper receipts for dollars which were actually gold coins or so you know so now bitcoin and this is taking the same mechanism bitcoin is actually backed by the world's most valuable commodity which is computing power that is where it gets its value hold on

because bitcoin the network is the single strongest computing network in the entire world there's no computer network in the world that is stronger than the bitcoin network so what so i got so i got bitcoin can i redeem it and get some computing power that i can somehow use like you know in my daily life no because because it's not about redemption it's about actually securing it the value hold on the value of the dollar was not about redeeming the gold to then go do something with the gold the value of the dollar was about being secured by the store a value of gold right so yes you could go redeem it but that isn't the reason why there was a peg the reason why there was a peg or a backing was so that the physical paper would actually retain

the same value as no no it wasn't a peg or a backing the dollar was legally defined as a specific weight of gold that's what so the dollar had value because gold had value it had the value of gold when we started bitcoin has value because the computing power no the computing power has nothing to do with the bitcoin itself i don't i don't get to utilize that computing power because i have bitcoin you're using it by holding bitcoin you're using the computing power because hold on a second because this is very important you're using the computing power to defend your purchasing power what purchasing power i just have bitcoin i only have purchasing power if someone's willing to buy my bitcoin from me which is the single greatest protector of purchasing power

on the planet over the last 10 years the purchasing power of gold is gold's value relative to other commodities that you can historically look back and think or see how much gold do i need historically to buy wheat to buy oil to buy soybeans to buy copper i mean gold is a real thing all right there is nothing secure but there's nothing hold on gold is a real thing hold on because this is an important point because like history is lined with the gravestones of the people who've failed to identify and accept technic technic technological innovation and you're siding with blockbuster and you're siding with kodak and and you'll put yourself on their side the investment the investment graveyard is littered with people who have fallen for

ponzi's and and pyramids and the latest get risk quick stream i mean bitcoin bitcoin doesn't even match the description of a ponzi so you're incorrect that it doesn't no i know it's more of a pyramid not really yes people make money in bitcoin because other people buy it but hold on you need more people to get in so you can get out forget every financial no it's not that's not true no it's not it is you don't all right when you own a bond right nobody has to buy it from you the i buy a bond i hold it to maturity the lender pays me back i get my interest i buy a piece of real estate i live in it i can rent it out nobody ever has to buy it from me i own a stock i own a business the business earns income it pays me dividends so i never have to sell that

bitcoin doesn't pay dividends it can do it can yeah well oh no then you have well you have to loan it out yeah but hold on but how are they how is the borrower going to generate income because bitcoin doesn't generate it this is the most important part i think is would you agree with the statement every single financial asset in the world is engineered to continue to go up against the u.s dollar because the dollar will continue to be debased because they have no choice no it's not engineered that way and not look there are a lot of companies that are going to go bankrupt i mean just because the dollar is going down doesn't mean an asset can't go down even faster equities as well there's always good or bad within a bucket but equities will continue to go up over long

periods of time because the dollar will be debased real estate yes yeah yeah in nominal in nominal terms pretty much every real asset is going to go up measured against the dollar now measured against gold something like that no i mean can i can i ask a question when you buy gold and again i understand that your entire portfolio is not gold but when you buy gold is it fair to think that what you essentially are doing is you're hiring a scientific engineered metal to defend your purchasing power? No, I'm not hiring anybody. What I'm doing is I am storing my purchasing power in gold rather than in a fiat currency. Okay. Right. Because gold as money is liquidity. It's a store of value. I'm not using it right now as a medium of exchange, uh, though it could be used

that fashion, but it's not. Uh, but I use it to store liquidity, um, more so than a fiat currency. And if I, you know, I'm going to own a fiat currency, I'm going to be in, let's say, the Swiss franc over, you know, other fiat currencies because I think it has less problems. But it's still not as good as gold. So I'm going to hold it and I'm going to use that gold in the future to buy things that I need, including more investment assets. You know, if the price comes down, even if the price of my gold goes down, if gold drops by 10 percent, but stocks drop by 30 or 40 percent, I can still take advantage of that decline by using some of my gold to buy stocks. But if we have massive inflation where stocks might double in price versus dollars but go down by 50% or 60% in gold, right, because in real terms, stocks went down. They only went up in nominal terms. Then I can use that appreciated gold to add to my equity position.

When you buy Bitcoin, what you are doing is you are hiring millions of people around the world and the strongest computer network in the world to protect your purchasing power. And in an analog economy, that may not be valuable. But in a digital economy, it's the single most valuable thing that can protect your purchasing power. Because the opportunity cost in a digital economy, in a digital economy, you don't have the opportunity to buy physical real estate. You can't use gold on the computer. So what ends up happening- Well, first of all, there's gold in computers, number one. Again, again, again.

That's the reason they work. Of course. but but hold on but when you look if i'm going to operate 100 digital i'm going to operate 100 digital in a digital economy you cannot buy the analog assets first of all let me say something the strongest computer network in the world to protect your purchasing first of all when you're buying bitcoin you're not you're not hiring somebody to protect your purchasing power you're just buying into a mass you know delusion and you're just hoping that bitcoin miners the bitcoin miners in the last 24 hours were paid over 50 million dollars worth of bitcoin to continue to

secure the network yeah they're gonna do that as long as they can make money mining bitcoin which means there has to be more fools that are willing to buy it but you're buying in to that hysteria that more people will keep on buying it it's a constant pump you got to keep getting more and more money into into it more people have to come in uh to maintain the whole thing because they still get hold on a second even if bitcoin's price is important even if bitcoin's price dropped 99 the 900 bitcoin that will be mine today will still be mined if bitcoin's price drops 99 if if bitcoin's price drops 99 no one's going to want to buy it it's not going to drop 99 maybe you guys but the vast majority of people will will will be out of bitcoin for good but let

me i want to ask you one more thing because i i don't this doesn't make any sense you keep talking about the digital economy the digital economy i mean what what do you mean digital economy i mean just because there's like a metaverse and and no no not a metaverse no no we're not talking about metaverse i'm talking about the fact that right now if you think of the businesses that you own in your equity portfolio how many of them have factories how many of them have a large transportation uh fleets how many of them actually produce physical goods etc a lot of them okay a lot when i'm buying but well of course that's why you haven't outperformed me but if you think about the digital economy right is in the digital world there are now these businesses that are

being created now there are incumbent type digital business so think of facebook for example they still have physical employees they have physical offices but that's not where the value of that business is derived the value of that business is derived from what happens in the digital world not the physical world well no facebook derives its value from advertising revenue and people are advertising real things in the physical world that people not always people need and not always buy not always well what are they and so take let's say for example a media company right many of the media companies are advertising to have digital subscribers for their digital content on top all right but the the people who are creating that content they need to eat they

need to live somewhere they buy products i mean our trade deficits are at all-time record highs because we're buying more actual stuff of course we're not but not all living in some digital fantasy world i'm gonna say two things digital food and live in a digital house and drive digital cars i mean people use wait one second wait one second hold on i'm gonna let peter uh chime in here in a second but in you're a little bit older than me not much but a little bit uh when you first started to drive you had to do what you would go buy a car you'd go to the gas station you would buy a map, a physical map, look where you were going on a long road trip, and you would start to drive. And you normally would have to have a physical, either eight track

or a CD-ROM or whatever, in order to listen to music, et cetera. Now, if you just think about getting in a car and going on a long road, you don't buy the physical map anymore. It's been digitized. You now use the digital version of that asset. You don't buy the eight track or the CD-ROM or the cassette tape player. Instead, what you buy is you have digital music that you probably are paying a subscription. You don't even actually own the song itself. That's been digitized.

And so there are some things like a car that will never be digital. You will never be able to take the car, put it in some digital world, and then you and I can like fly down the highway digitally. Right? So yes, there are still things that will exist in the analog world.

But the trend is that everything in your life that can be digitized will be digitized. And I would even argue that the taxi has been digitized because now what has occurred is the largest taxi company in the world owns no cars. The largest hotel chain in the world owns no hotels. They have all become asset-light, digital-first businesses. Now, the important part you mentioned,

the cars are still there. They're still on the road. Agreed. And even if the drivers one day go away and they're self-autonomous vehicles- We're going to digitize the drivers. still no they're not the cars are still there but you know what money is like the car money ain't going to be digitized you're not going to take real money and just represent it digitally but

that's already happened bitcoin already been represented digitally no no no that's fiat you can you can you can take fiat currency and represent it digitally i'm not talking about fiat i'm talking about real money which is a commodity is going to be a real thing but in But you're hoping that Bitcoin can replace fiat paper currency as a fiat digital currency. No, no, no, no, no, no, no, no. No, we're not actually. But anyway, just like history of money. You're obviously a gold guy.

You studied the history of money, all the different forms of money during the evolution of money. Did they all have uses outside of being money? Did rye stones and marbles, when they were used, what were their use cases? What was the use case for what? Like rye stones and marbles, the history of money, forms of money, things that became money. Marble? When was, you mean, you're talking about... Marbles. Little marbles that kids play with?

Yeah, they were... Well, then that's what they did. They played with them. No, no, no. Historically. Historically. They didn't become, nothing became money. Shells became money. Unless, yeah, but people, you know what they did with the shells? They adorned themselves with them.

Like, cigarettes were money, right? In prisons, the GIs used them because you could smoke them. The reason that cigarettes were valuable as money was because people smoked. Well, if I could wear my Bitcoin, if I can wear my Bitcoin, does it have value? You can't wear your Bitcoin. Well, if I can wear a representation of it. No, well, that's, no. But the point I'm making, Peter,

is that what you seem to be missing here is that we aren't even against gold in this room. You know, there's gold and Bitcoin. We're not against it. We understand that people use it. People like yourself want to store it. You seem to me missing the point that other people just don't care about gold.

They found a new form of money, and they're going to use it. No, no, they think they did. They think they found fool's gold. No, no, but bear with it. People, enough people, 150 million people worldwide have decided this is the form of money that they want.

Yeah, well. Bear with me. They like the trade-offs. They don't care that it isn't used industrially, but they like the trade-offs that they can store it on their phone or their wallet, send it anywhere in the world instantly. So they've made that choice that they think that's better money. Hold on, Peter.

Peter, sorry. Why can't you accept that other people have decided this is the form of money they want? They haven't decided it's the form of money. They decided this is what they're going to buy to get rich. No, no, no. People think, people expect the price of Bitcoin to go way up. If they didn't do that, right?

let's assume people assumed that the current price of bitcoin whatever it is 56 000 57 000 whatever that's a long way from when you heard about it but let's say that everybody accepted that this was it this was as high as it was going to go right 57 000 this is the price how many people would still be buying it right now if they thought this was the peak hey you know i'm happy to have i want bitcoin as my money i want to use it but it's 57 000 it's not going up right this is where it is do you think you would still have all these people would it would it would it be because then it's still not stable because then it's subject to the the debate okay it's going to go up with inflation okay it's going to go up five percent a year six percent a year whatever

i give you six million people straight away i have it the entire population of el salvador because they wouldn't need to be dollarized anymore no the population is stable because it's stabilized it's not it could fall i'm not saying you got a free put i'm just saying it ain't going up all right okay so i want to switch to the currency that can only drop so you just i want to switch a pointless no but i'm saying people thought this is thinking professor i have a question can't go up anymore i want to change topics for a second uh let's just say for a second put aside the medium of exchange argument around bitcoin so whether it's a currency for a medium of exchange or not whether it's a unit of account or not who cares uh for

the purpose of this conversation a store of value whether you like it i like it we don't like it whatever bitcoin has continued to go up in u.s dollar terms yes but that's got nothing to do with the store value hold on just means the price has gone up hold on storing value and no you're not storing price going hold on hold on storing value because that asset exists like many other assets real estate uh physical machinery whatever people are willing to financialize it they're willing to lend against it they're willing to borrow capital to buy it all this type of stuff there's been a whole focus recently we now have uh news that big banks are starting to look at bitcoin backed debt also disaster that's going to be hold on a second el salvador el salvador

went ahead and said that they're going to issue this bitcoin backed bond and they're going to put 50 of it in bitcoin 50 they're going to use to build out certain things i saw your tweet where You said it was worse than the subprime debacle. It will be if they take that as collateral. I disagree. But hold on, hold on. I'm going to give you the floor to explain first. But just so you know, I know a lot about this,

and I'm warning you, don't say dumb stuff, or I'm going to prove you wrong. I never say dumb stuff. Why do you think it's worse than subprime? In all seriousness, why do you think it's worse? Well, because you're talking about Bitcoin as collateral for a loan. and the problem with subprime mortgages was that the real estate that was collateralizing it could lose value okay right and and so when the lender if the borrower defaults and the lender

looks to the collateral this house and now they go to sell it well the price could be down so you're saying just so people at home can pay attention here so let's say a house is we use these numbers a hundred thousand dollars and in order to buy the home uh i put down no money or five percent put down five thousand dollars and i brought ninety five thousand dollars to buy the home right based on the fact that the home is worth a hundred thousand dollars and historically the idea is that that house if it's worth a hundred thousand dollars today 20 years from now will be worth more than a hundred thousand dollars the problem is if two years or three years from now because you might default right away you might lose your job you know right after you buy the

house so the idea is if though the house actually isn't worth a hundred thousand dollars because the market had gotten too hot and people had gotten loose with their lending requirements now all of a sudden i actually lend you not the hundred thousand dollar value the house you're going to buy the house for two hundred thousand you still put down five thousand i lend you 195 grand and you default when i go to liquidate the house i can't sell it for 200 grand i have to sell it for 100 grand of what the actual value is i'm underwater on the loan because i wasn't able to do it well yeah i mean now you're talking about a big decline a 50 decline in real estate which i'm just using an extreme example but right that's rare right the problem with bitcoin is a big drop

let's say a 20 30 drop isn't rare it happens all the time hold on because this is really important i i actually think i'm going to get you to understand why bitcoin backed loans are very unique to the point where you may go and participate ready in a house uh situation if i gave you that $195,000 loan and the house declined, whether it was 5% or 50%. In order to liquidate it, I have to sell a house. And if the market is declining, it is very, very hard because it accelerates like it did in the housing crisis. Everyone was dumping houses because there was so much inventory in the market. There weren't enough buyers. People were in dire financial situation. And so it got worse and worse and worse, faster and faster. Tons of large lenders got in a lot

of trouble very quickly. We got the global financial crisis. With Bitcoin loans, one of the things that is very unique about them is if you said to me, hey, I have $200,000 worth of Bitcoin, you can only borrow on these platforms up to, let's say, $150,000 against your $200,000 worth of Bitcoin. So it's an over-collateralized loan. Now, the value or the advantage that Bitcoin has compared to your house is when the house price starts to fall, there's no mark to market. So it's hard to tell, but you can feel it in the market. You can see comps and stuff like that but you have to sell the whole house to recoup your cost with bitcoin it's a highly divisible asset it can be uh denominated up to a hundred million satoshis and there's a liquid

market so what these lenders will do is they'll say give me your two hundred thousand dollars of bitcoin i'll give you a hundred fifty thousand dollar loan you go do whatever you want with a hundred fifty thousand dollars uh a loan i'm gonna take your two hundred thousand dollars of bitcoin if the price starts to fall i give you a margin call i say hey you're now at 70 margin you have to cure the margin call if you don't cure yeah i understand hold on a second i can sell a piece of the bitcoin into the market so i have to sell all 200 000 i can sell a thousand dollars at a time if i want it and i can make sure that i will never lose money on the loan because i can always liquidate the over collateralized uh all right so let me let me

stop any sort of default let me stop you so first of all yes um loaning against bitcoin is more similar to loaning against stocks than loaning against real estate mortgage because mortgage loans uh you know yes real estate it's not all identical and yes if you have to foreclose there's a whole process and then you got to put the house on the market and you know it could take a while to sell it uh and but of course too when somebody takes out a mortgage you know they don't mark the house to market every day you can't get a margin call as long as you pay your mortgage you don't lose your house but if you leverage your stock portfolio they mark the stocks to market every day And if the stocks fall by a certain amount, you have a margin call.

You can't meet it. They start selling your stock. They don't sell all of it. They sell what's required, right? The same with Bitcoin. The reason I think loaning against Bitcoin is inherently riskier than loaning against stocks. And let's say you're loaning against non-dividend paying stocks. So the owner is not getting any income, is that I think Bitcoin is more volatile than stocks.

So more likely, now, obviously, any individual stock, you know, look at DocuSign today, down 33% overnight. So if you were on margin for that one stock, but I think brokerage firms, when you margin one individual stock, sometimes they up the margin requirements. They're worried that they could have a big move. um but i think bitcoin is more prone to a uh a big move okay but also here's what you forget let's assume that there is a 30 40 drop in bitcoin let's say 50 which happened last march all right i have an example i don't want to say the company but i know a business that had billions of dollars of bitcoin backed loans out on march 12th or march 18th whenever it was and

Bitcoin fell 50% in one day, they had zero loss of capital. Yeah, I mean, they were very fortunate at that time. But I would imagine that, let's say, Bitcoin were to drop 50% in an environment where a lot of people had Bitcoin loans. And I think a lot of people who have been hodling Bitcoin are probably taking advantage of these loans because, A, they don't want to sell their Bitcoin and pay tax. They don't live in Puerto Rico, so they don't want to sell their Bitcoin and generate taxes. They also don't want to get off the gravy train. They think it's going to the moon. They don't want to miss out on all the appreciation, but they want to get out of their parents' basements.

They want their own place. They want to buy a car. Well, there's also opportunity cost. There's not many other places to go in assets, right? You can't go back to dollars because that's obviously being depreciated. Gold is down 6%. But my point – but here's my point. My point is that a lot of these people are borrowing against their Bitcoin, and they're going out and buying stuff.

So they don't necessarily have money to meet a margin call if they get it because they spent it on a car, they spent it on a vacation, they've barred against their Bitcoin. So let's say you get a big drop in the price of Bitcoin, 50%, and now the margin calls go out and the people are like, I don't have any money. I spent it. Okay, well, we got to liquidate your Bitcoin. Well, everybody's getting liquidated at once. And where are all the buyers? All of a sudden, you have this massive liquidation into a weak market. Maybe the exchange is shut down.

Maybe it's like, oh, you can't even sell. But we had this happen. This is an hypothetical, right? We had this happen in March of last year. What you're saying, it has some- There may be way more leverage now than there was then. There's less leverage than there used to be. And more liquidity.

Yeah, but there was a 50% drawdown, which I think is a fair argument to say, hey, if a bunch of people are doing this and then there's a mass liquidation, right? Obviously the price falls drastically. My only point is that Bitcoin is the single best collateral for the lender to take for a loan why is that the best collateral because even in your example of stocks i have to sell the full stock so if an apple you have to sell a full share you have to

but but yeah but hold on but that's still small money but you don't have to sell the full share of bitcoin in order to continue to protect the one i mean that's that's really so a share of stock might be ten dollars a share fifty dollars a share i mean people would people are borrowing $50,000, $100,000. I mean, so at $10, how many shares do I have to sell? I have to sell, what is that, 5,000 shares? The amount of money, the fact that you can't break a share down into a half a share is ridiculous

because that's such a tiny amount of money that it doesn't matter. Depends on the price of the share. No, you could sell, if I buy, if I margin 1,000 shares, you could sell 999 of those shares. you know if you instead of 90 999 and a half i mean all right joe you you haven't said that much what questions you got for p i want to know your question your uh opinion on stable coins well i mean stable to what i mean stable to a fiat currency because there's no stability there so

um that was exactly what i expected but if you're talking about stable to a particular asset i mean obviously the best use case for a stable coin would be gold right take a piece of gold why have you not created a gold well they exist i don't have to create them but um you can have a gold coin i mean this is the closest thing to what the blacksmith did originally with gold was you had a blacksmith he had some gold and he wrote out a piece of paper an iou and people traded that transacted with it instead of lugging around their gold it was like hey i got some gold over at the blacksmith here's uh here's the iou why don't you take this in exchange for goods and services and you know you can go get your gold whenever you want and so uh the note circulates

in as a substitute for the money that i have uh you can certainly do that but what about stable coins yes yeah i'm talking about stable coin that's stable to the price of gold i can have an ounce of gold or a gram of gold but the price of gold home this is an important point the price of gold is not stable well then nothing is stable hold on a second the price of gold in u.s dollar terms is down 10 on a real return right but it's stable it's stable in gold terms it's stable to itself okay well my shoe is stable in shoe terms right but the the u.s dollar is not stable in terms of the euro or the japanese yen or the swiss franc every currency is going to have an exchange rate with every other currency the purchasing power of gold has gone down only over a short

increment of time over the last decade it's basically well over the last 20 years look at it's gone from uh less than 300 to 1800 and over the last 50 years over the last 100 years it went up 500 bitcoin did that since october 2020 yeah i know bitcoin is a speculative token what it did is irrelevant to what gold's done a gold is a long-term store value it's completely relevant but i want to get back to the stable coin all right you to have a token that is stable to a real thing like gold or look you can you could you could have it you know tied to oil you can have it tied to coffee i mean let's say i'm starbucks and i know i buy a lot of coffee you know maybe i want to have some of my balance sheet in coffee it's called a digital digital

token backed by coffee so because i know i have to buy coffee anyway so i can have my money that are that is tied to the purchasing power of the good that i need so i think there's a use case for creating digital tokens that are backed by real tangible things that people use and people need. And then you could use those things. Like computing power. But when you have Bitcoin,

you don't have any of that computing power. I can't use that computing power. It works for you. You hired it. No, I can't take my Bitcoin and plug it into anything and power anything. I can't do anything with Bitcoin. Like I can do something with gold

or do something with coffee. You can. you can buy services with your bitcoin no but i i can give it to somebody else that doesn't count as using it yes it does but i can sell literally using it but i know it's not it's exchanging it but i but i use i use the bitcoin when i put it on my balance sheet i use that computing power every single day but that's nothing no you don't yes i do hold on a second this is another important point when you put your gold you got your gold at your house no right i'm not telling you where i got my gold all right where the gold at you ever seen the meme where the gold at uh all right so

the gold is sitting somewhere else in in custody somewhere wherever it is whether it's you uh somebody at your house and you've got security systems there whether it's at a bank a vault whatever you have hired a bank a custody provider etc to protect your gold all right okay when i buy bitcoin and you're trusting i hire millions of people around the world to defend to the death my purchasing power no they're defending to the death your bitcoin your purchasing power can evaporate because they're defending nothing see i'm paying people to defend something and you're paying people to defend nothing that's the difference but you're just hoping that other people don't recognize that bitcoin is nothing and they'll keep buying it but no i don't need i

don't need anyone to buy bitcoin that's sure you do no i don't no i don't because my bitcoin i see the difference if people stop buying bitcoin how are you going to sell yours if i showed you they're not going to stop buying gold they need gold if i showed you if i showed you the generational shift of i think other people buying gold has gone down drastically so you're telling me that the the gold jewelry industry doesn't exist anymore it's collapsing no it's not the demand for gold has completely collapsed and i have proof i have proof ready here's my proof gold's nominal price not as real return price is nominal price down four percent gold has collapsed no it hasn't it is down 10 percent so over the last year so what that doesn't mean

that demand for gold has collapsed well that's exactly how price yeah that's how price is determined right is based on supply and demand there i will agree that investor demand for gold has gone down okay not people are dropping gold investors are dropping gold no investors are more inclined to gravitate to risky investments right now like bitcoin uh because this is a massive a bubble people are getting rich speculating gold is not about getting rich it's about preserving wealth i feel bad people are very very risk i feel bad right now i feel bad i feel like you're wasting money by hiring the custodian and hiring the vault and hiring the bank what i'm trying to get you to do is there are millions of people around the world you want me to waste money

buying bitcoin no no no there are millions of people around the world that they want you to hire them they're begging you peter shift please hire me to do what take your life and plug it into the bitcoin network the node operators millions of nodes around the world will go to work for you millions of miners will start working for you they will defend your balance sheet for you there's literally put my balance you can hire me this is how peter shift this is how peter shift hires peter mccormick and pomp you but one day i'll be on your balance sheet clean put clean my bathrooms because you guys are gonna be broke you put bitcoin on your balance you know because we're rich now yes you're rich now because you're loaded up on the overvalued this is a serious

question if you had to today if we each had a hundred dollars and you bought gold and i bought bitcoin with it in five years on the u.s dollar conversion rate which one do you think would be higher in five years well i mean my guess would be gold but you know i mean i'll bet you a million dollars right now look you don't you don't have to bet me you're already betting you have all your money in bitcoin you're i have no money in bitcoin so no no i'll bet you a million dollars cold cash i'll pay you in gold if you want five years time i don't need to i don't want to bet you where it's going to be maybe bitcoin will be higher so i don't i don't you know i i just don't see you saying there's a chance i don't think it will but it might be but meanwhile i don't i don't

i don't see any reason because i'm not i'm not making bets with everybody so many people want to bet me on bitcoin and what else would you give it what odds would you give it that bitcoin will be higher than gold yeah in five years time i don't know i'm not an odds maker i mean it's certainly possible that it could be higher i mean i mean could the bubble go on i'll be a hundred thousand dollars i'll give you ten to one yes that's pretty good odds i'll think about it you think about it yeah you know but we have to find some way to make sure that you pay me you might when bitcoin crashes i don't know that you'll actually have any ability to pay me listen that was a convenient way to get out of the bed we only have about 10 more minutes i want

john you got any more questions yeah i'm curious when you think about the fact that i can get interest on my bitcoin as well as price appreciation or depreciation um and it's harder to do that with gold yeah first i did one thing though see if i actually had that bet and i knew you were going to pay me then i can actually buy bitcoin because i have like a free put on it because if it goes down you have to pay right because but because so you see value in buying bitcoin only because you gave me 10 to 1 odds that it was going to that i guess it's going up but but that that allows me to create a situation where i can't lose except your credit worthiness is my is my risk all right what was your question my question was talking about how i can earn interest on my bitcoin as

well as price appreciation or depreciation and you can earn interest on your bitcoin i understand now because there are people services that will pay you but the question you have to ask is okay how is this company generating this money to pay me what is being done with my bitcoin in order to generate this income so the person who is taking your bitcoin they either really want it badly because they want to short it and they need bitcoin to they need your bitcoin to sell and so they're short bitcoin and they're willing to pay you because that's how much they want to be short bitcoin and and they think the price is going down or they're not necessarily shorting it they're just trading the hell out of it they're just buying and selling it a lot and they just need

your bitcoin because they don't have it themselves but a if they're doing that they could always lose the bitcoin and if they lose the bitcoin because you know then how are you going to get yours back so there's obviously got to be a lot of risk um but banks inherent banks that with dollars it's just fdic insured um they lend it out on the back end and they give me part of the yield that they get but in in that respect you would think that there there's some more productive activity going on whether it's going into a business or you know there's some something other than just financing trading or short selling um but also if you look at the yields that are being paid on bitcoin now compared to the yield on a bank account i mean what are you getting five ten percent on bitcoin

it depends yeah yeah well obviously you know point uh 40 basis points on a savings account yeah i'm so to the but obviously if the bitcoin interest is much higher then there must be a commensurate increase in the risk in order to generate that return in such a low interest rate environment So inherently, people are taking a tremendous amount of risk in order to get that type of return. And the question is, you know, what and when is it going to blow up? Because you don't get something for nothing. And, you know, you may get this interest. You may get or you may end up losing your Bitcoin, and in which case your interest is negative because you'll end up getting, you know, fewer Bitcoin than you deposited.

But ultimately, it might not matter how many Bitcoin you have if they don't have any market value anymore. or because the price crashes. Which won't happen. All right, Peter McCormick. It happens routinely. Peter McCormick and Peter Schiff. Peter, can you move the photo a little bit so we can just make sure everyone can see it?

That's my Twitter photo, isn't it? I don't know. You look quite handsome there. Try to turn it more towards me. There you go, right there. And my wife took that photo. So here's what I'm going to say. We have eight minutes left before we're going to wrap up.

I'm going to give the floor to Peter McCormick to ask you anything he wants in the last eight minutes. You two can have a little conversation, then we're done. god uh okay what i would ask you is you know you've said lots of people are holding bitcoin just to get rich in a scenario say protesters in belarus protesting against lukashenko and wanting to strike and not having the money because they were paid by the state and they were receiving bitcoin donations from around the world where they had instant liquidity and they

can convert them to their money local money so they can support their family or this case in nigeria with the protest the nsr's protest people they're trying to protest against the government and bitcoin is around we'll send them the money how else would you do that well again it would be much better to do that and all the technologies here in fact there are coins that you could use but rather than sending a digital currency back by nothing just send a digital currency back by something most likely gold so i can send somebody gold digitally ownership of gold i can transfer my ownership of gold to anybody in the world probably quicker and less expensive

than you can transfer ownership of Bitcoin or your actual Bitcoin. And they could do that. So you agree on a cryptocurrency as a solution? Backed by gold. But you agree on a cryptocurrency? As long as it's backed by something. Backed by gold.

It can't be backed by nothing. But if it's backed by gold, it suffers from the centralization problem that Bitcoin solved. No, no. It doesn't suffer from any problem. It's an IOU. no but if you have a trusted third party that has the gold and that digital currency entitles you

is a receipt for the ownership of that gold then you own the gold and then if i transfer that ownership to somebody else now they own that gold and they could use that as a medium of exchange as a store of value of a unit of account it does everything that bitcoin does without the flaw of bitcoin and that bitcoin has no value but my gold-backed digital currency has all the value of gold just like the federal reserve note had all the value of gold when it was backed by gold see mine does everything yours does without the risk of centralization but you also don't have the security of a store of value because you have nothing you have fiat the difference is yours is fiat and mine is real well mine is backed by back by nothing it's back by you know you know i don't

think we're ever going to change your mind i think we've come over the years everyone's I think you've made a choice. I'm grounded in reality. It's not like I've made a choice. I'm just looking at the rules of economics. I'm not living in a fantasy. I choose reality. Would you ever think about buying equity in businesses

that operate in the Bitcoin or crypto world? Well, people talk to me about that. Let's just use what I believe is the largest publicly traded uh like native company to the space which is coinbase would you ever buy coinbase stock i don't own it um you know look there are a lot of stocks obviously to the extent that the bitcoin bubble gets bigger then companies like coinbase could potentially profit from that i don't necessarily think coinbase is that great a business i mean even if bitcoin succeeds um you know there could be a lot more competition for coinbase their spreads can go down uh a lot of

things can go wrong the stock's expensive i mean it's not generally the type of stock that i like okay um would you buy would you buy uh last year micro strategy issued a bunch of debt i think three separate tranches of debt uh in these bonds now they use it to go buy bitcoin but it's a bond would you ever consider buying those bonds considering they ended up being the best performing bond no well i mean what i look you can always say with the benefit of hindsight oh i could have bought them because they they did it right but would i buy them today no i mean i don't want to buy bonds um where the collateral is bitcoin i you know i'd rather buy the bonds of microstrategy than the stock um because if bitcoin crashes and you know and at least a bond you know

and MicroStrategy could go bankrupt, the bondholders, I think, could still go for the equity. But I wouldn't want to buy either. I mean, I don't think MicroStrategy is a business anymore. It's basically, it's a Bitcoin ETF. It's a leveraged Bitcoin ETF. So I would have nothing to do with it. They do $500 million in revenue.

Well, but at this point, I think it trades off of Bitcoin. I think the software is an afterthought. And I don't even know how well they're even managing that aspect of the business i mean they ought to just spin the business off they ought to just sell the software enterprise business to another company so they could just be just bitcoin but i think they they just use whatever income they generate from that business to buy more bitcoin to buy digital sound money no they're not buying any sound money they're buying they're buying bitcoin don't confuse bitcoin with sound what is how do you define sound money well you know what's

you know do you know where the word comes from sound money it's the sound that it makes right when you drop it okay right so what sound does bitcoin make when you drop it i've got some bitcoin on here that no no that's the sound of the phone and i can send it no no i can make the same sound when you drop your wallet that has cash in it hold on i know you sound money is real it's a coin that's not the definition the definition of sound money is that it is outside of the system and no one can create more of it gold is outside of the system right and nobody in the world can create more gold we may discover more gold we might not but nobody can create more gold as far as we know today so it's outside the system and nobody can create more based on that definition

bitcoin is outside of the system and no one can create more that's not the definition of sound money you can't just make up a definition and then say based on my made-up definition bitcoin is money what is the definition but also i i i would say that just because somebody can't create more bitcoin and i'll give you that they can't i mean we don't know i mean maybe the miners will somehow be able to decide that 21 million is not enough and somehow there's gonna be more they can't all right i'll just take your word operators won't allow right all right well well we'll see well they won't because they own the bitcoin all right but you have to trust that that's the case that is the case all right but just because there won't be more bitcoin doesn't mean there won't be

more cryptocurrencies that pretty much have the same properties that Bitcoin has that can't be used for the same thing. Peter, this argument we need to bury now.

No, you can't bury it because that's the elephant in the living room. Go and create one tomorrow. I'll show you how to. What do you mean? I know. There's like 14,000 of them.

Yeah, no one will care about your one. How do you know? Why do they care about Cumrocket? Well. I mean. you were waiting you waited a whole hour

on your way over here you thought of that one i'm very i'm very impressed that you held that in your back pocket for an hour that was very impressive that was great that was great constraint but now here now here's what i want to say is that my prediction for you is my this is a peter shift prediction is that within the next decade, you are going to have more exposure to Bitcoin and the crypto industry than you have not to the industry.

And here's why. One is more than 50% of your portfolio will have exposure. Not my portfolio. Yes, I promise you. Here's why. Every single equity you own is going to interface with this technology.

Well, so far, none of them are. So how is all this going? That's not true. That's not true. Come on. Do you hold the S&P 500? No. You don't hold the S&P 500?

you have no s&p i i've heard of it yes i don't know yes you don't own any of it do you know i own a couple of stocks in the s&p okay do you own qqq no no no what is your equity portfolio i i own uh a chevron i own exxon okay they're both they're both exxon and chevron will both mine bitcoin before the end of the decade why would they mind because it's the single most valuable thing they can do to monetize their energy production there's nothing in the world that they can make more money then turning that energy production into bitcoin well you know that's why every oil and gas organization all throughout texas that would be such a waste of would you sell the stock if they did that well look depends on how much money they had to invest look bitcoin miners are making money

now some especially i mean i a lot of bitcoin miners live in my neighborhood there's a bunch of them i can see how much money they're making you know there's funny people are like oh peter you know you do you regret not buying bitcoin you know a year ago no i regret not buying more residential real estate on my block because that's gone up five fold way more than bitcoin no bitcoin's gone up more than you're not in the last year when is the first time you heard about bitcoin not in the last year like bitcoin has it's 20 to the beginning of 2020 and stuff had gone up no no this in 2021 oh 2021 yeah yeah yeah because all you bitcoin guys are coming into my neighborhood paying crazy prices for all right hold on a second but the housing prices didn't

go up 5x yes they did a lot you you don't live there you don't know what how much did the houses cost last year a fourth or fifth of what they cost this year i didn't want to tell you where my house is last thing well i was i've done remote interviews with you you still have dial up internet so it can't cost that much all right last thing is you're not only going to have your entire equity portfolio is going to have exposure to this because every single business is going to start to play in this uh whether it's the oil and gas companies whether it's them putting bitcoin on their balance sheet, whether it's them interfacing with the lightning network for payments, they're all going to participate. Second is that from a real estate perspective,

you're going to see more and more of them start doing the exact same thing across many different cities in the world. People are starting to accept Bitcoin as part of their strategy. Some of that is for marketing purposes. Some of that is because they hold it on their balance sheet, but it's going to happen. Lastly, is that a lot of the passive income that you have or yield generation type income let's say uh bonds or various types of debt they're going to start to incorporate it as well because what you're going to see is that calpers but what is that i think it's the largest pension fund in the united states calpers recently just said they're going to go more into alternative assets they're going to start taking on leverage what they're going to find out is that it's going

to be much better for them to buy the exact same fixed income that they have and instead divert one to two percent of every single piece of fixed income into bitcoin put what is a asset that continues to appreciate with that low volatility asset and it will still outperform all the other all that is just pie in the sky you know assumptions that you're making well a nation state is issuing a billion dollar bitcoin backed bond that's not pie in the sky which nation state are you talking about el salvador yeah el salvador so that that's your example is mass great adoption you got el salvador been conned into doing this i mean yeah but we were gonna start without lies Yeah, well, you're going to start and stop with El Salvador.

Russia is a net seller of gold. Paraguay is making mining legal for their excess hydropower. Yeah, well, look, all this is part of the hype to try to get people to buy. Meanwhile, Bitcoin hasn't been going up. I don't know if you bothered to check, but despite all your pumping and constant pumping. What percentage of your portfolio is gold?

Since July, it's up almost 2x. Huh? Since July, it's up almost 2x. Well, I mean, but it's still below the April high. It hit $69,000. Nice. It hit $69,000 two weeks ago. Yeah, but it's at $56,000 now, $57,000? It was at $65,000 in April of this year.

So despite all the pumping from then, it's lower than it was back then. Gold is down 4%. Look, I'm not talking about back then. I'm talking about now. Why isn't it at $100,000? How many people have come on, I see on television all the time, they still have $100,000 price targets for the end of the year, even today. There's less than a month to go.

Peter, Peter, hold on. Hold on, Peter, Peter. Didn't you say gold was going to hit $5,000? It will. I never made a hat out of it, though. Yeah, that's because you're not as entrepreneurial as me. Entrepreneurial. But you got people saying it's going to be at $100,000.

Now, are you guys still thinking it's going to be $100,000 this year? Is that still your forecast? I don't. Finally. I still see people come on CNBC picking this year $100,000. i think on a probability basis that there's uh still a chance doesn't mean that it's guaranteed to happen but i think that there's still a very good there's always a chance you're gonna bet me on a hundred thousand by the way you don't think it's gonna go i don't think yes you give me a

hundred to one odds on a hundred grand by the end of the year look yeah you know you may have a one percent chance no would you give me a hundred to one odds on a hundred grand by the end of the year no because they're probably there might be a one one in a hundred shot that it could would you give five to one odds on a hundred grand by the end of the year? Hmm. I mean,

so what are you betting? He's going to have to run some numbers. I doubt it's going to be that. Yeah. All right. Before we finish up here, what do you want us

to send people? Where are you talking about gold that we could send people? Well, you know, I don't just constantly talk about gold. I know.

You don't just talk about Bitcoin. I don't constantly talk about it either. You revived your career by leveraging bitcoin no no i you're the biggest bitcoin promoter in the world by the way unfortunately if anybody is bought bitcoin because of me i apologize i'm sorry they made money i know it's really bad they made money so well only if they sell you don't make money if you if you don't

sell if you're just holding on all right where do you want to send people look but what i do most of the time is i talk about the economy true you do understand the economy better than most yeah yes we agree on the problem yeah and so i talk about the economy i talk about current events i talk about politics i talk about the financial markets and then i talk you know about gold i talk about bitcoin and you know stuff like that uh so people should on a regular basis listen to my podcast i'm going to record one probably uh tomorrow morning because i'm i'm going to be busy most of today but i gotta wake up early tomorrow which will be tough because i'm to be out late tonight but uh i'm gonna record another podcast so you go to shift radio shift

radio uh shift radio.com is where my podcast is right now there's podcast now the radio is outdated but that's the url but you could create another one called shift podcast.com and then it could read i'm gonna buy that i'll sell to you but uh but you know it's a peter shift show is It's on SchiffRadio.com, but also on my YouTube channel. You can go and check it out there. And if you want somebody to manage your portfolio, that's what I do for a living. I manage equity portfolios at Europe Pacific Asset Management. That's my Puerto Rico company.

All right. And you can go to the website. It's EuropacFunds.com or Europe Pacific Capital. Europac.com is the website. How many websites you got? You're like a watch dealer. you're like which one do you want a couple of a couple different websites yeah a couple we're good on the website if you want to buy gold or shift gold nobody wants to do that yeah i know

none of you none of your well you know just in case the man has collapsed it hasn't collapsed you know gold's gold's almost 1800 an ounce how do you figure collapse well because it's down four percent over the last year so what so what gold is pretty close to its high the highest it's ever been in history and i'm almost a fucking unicorn but that doesn't count for anything i'm almost a unicorn that doesn't count for anything you're almost a unicorn yeah you're you're kind of sort of close to the all-time high and i'm kind of sort of a unicorn my brother's almost a mermaid like whoa no you're talking about this big collapse in the price of gold gold's eight almost 1800 dollars an ounce but isn't this when it should have performed the best well i yeah ironically

gold is up over 10 years listen gold gold is up over 10 years on a nominal basis three percent i literally can go get more interest at a crypto company than gold has done in 10 years i am poor if i bought the reason for that is because the 10 years prior it went from 270 to 1900 is that a big move in gold move up is that a big move in gold that's an enormous move up in gold man you're playing with a short period of time that's little boy numbers yeah well you know In the real world, that's a big move. And so gold got overextended. And, of course, what happened was, you know, the dollar had a big rally.

People, you know, became very confident in the Federal Reserve, which to me makes no sense. And how people are not losing confidence in the Fed is beyond me. But apparently they still trust the Fed. They still think these guys know what they're doing. And so they've sold gold because they expect the Fed to do the impossible. But look, the guys that are not buying gold are the same people that were buying subprime mortgages. They don't understand the problem. They're oblivious to it, and they're wrong.

And they're missing something that's even more obvious than what they missed back then. And I'm confident gold is underpriced at its current price. and it's going to have another big move up and people should be in on it now don't just dismiss it because it hasn't already moved up because then what are you going to say once it does you live by a weak gold price you're going to die by a strong gold price

Peter McCormick, where do you want us to send people? I'm a Bitcoin guy obviously you're a gold guy and that's what I talk about every day so look, if you want to learn about Bitcoin then you should just follow one of the smartest people there is and one of my best friends, which is Spencer K. Schiff. You can find him on Twitter, twitter.com forward slash Spencer K. Schiff, one of the smartest people I've ever met.

Yeah, because he's only 19. He needs more experience. He hasn't lived long enough. He doesn't have the wisdom. He's crushed you. He outperformed you over the last year. He's crushed you. um and it's bitcoin yeah i guess yeah he's a smart dude i met him in uh where did i meet him

yeah well obviously he's not smart enough yeah but you know he's smart but he's young it's you know when he gets older he'll he'll he'll learn you know the era of his youth and he'll come around anyway follow spencer k shift but what's your excuse that's a that puerto rico real estate right puerto rica who knew five x yes yes it is it is but i i think a lot of it is crypto related because some of the big buyers have been uh crypto people so they so they so they made the way i'm long i'm kind of long crypto by being long uh puerto rican real estate so uh but they made you rich huh well i haven't sold i'm not selling that's the problem so it's like it's all all right There are people that are cashing out, though.

They're the smart ones. Just one last shout out to the number one Bitcoin show, What Bitcoin Did, available on all platforms, the number one Bitcoin show. Is his Bitcoin show better than your Bitcoin show? Yeah, it is. Yeah, sure. Well, he's got the number one Bitcoin show,

but you got the number one business show? No, he can have the number one Bitcoin show. That's finally, after all this time. Yeah, he can have that. Well, I think what if I've got the number one Bitcoin show? Like decentralized and name only. Because I thought, I think I might have the number one Bitcoin show. I think my podcast is more popular.

There's zero chance that your podcast is more popular. Yes, it is. Depends. YouTube, you beat me. I'm usually kicking your ass on the charts. No. Yeah. I am.

But check the numbers. But if you added my YouTube, I'd blow right through you. That's what I just said. Yeah, but you've been at the game a lot longer than me. All right, we got to go.