We Study Billionaires - The Investor’s Podcast Network - BTC067: Russia Ukraine War & Global Macro Impacts w/ Luke Gromen (Bitcoin Podcast)

Episode Date: March 2, 2022

IN THIS EPISODE, YOU’LL LEARN: 02:07 - Luke's overview of the Macro Landscape since the Russian invasion of Ukraine. 02:07 - Energy to the EU. 02:07 - China's involvement. 12:10 - Zelenskyy's unexpected response and defensive posturing. 20:33 - Crops and fertilizer impacts. 26:47 - Belarus' involvement in the war. 26:47 - Turkey blocking the entry into the Black Sea. 34:09 - Canada weaponizing their banks. 34:52 - Weaponizing Swift. 34:52 - The Ruble crashing. 44:57 - Russia Minister working on a digital single world currency. 46:01 - India's energy demands. 48:46 - Gold's potential involvement. 53:55 - Bitcoin's potential involvement. 01:07:59 - Targeting high-net-worth Russian citizens. *Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences. BOOKS AND RESOURCES Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, and the other community members. Luke Gromen on Twitter. Luke Gromen's FFTT Website where he provides macro insights. Luke's books on Amazon. New to the show? Check out our We Study Billionaires Starter Packs. Are you looking to start investing? Check out our article on How to Invest in Stocks: The Ultimate Guide for Beginners. Browse through all our episodes (complete with transcripts) here. SPONSORS Support our free podcast by supporting our sponsors: Bluehost Fintool PrizePicks Vanta Onramp SimpleMining Fundrise TurboTax Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

You're listening to TIP. Hey, everyone. Welcome to this Wednesday's release of the podcast where we're talking about macro and Bitcoin. So today's guest needs no introduction, and he's back by popular demand, and that's Mr. Luke Groman. When everything in the Ukraine kicked off, Luke was the first person I thought to bring on the show because he's such a wealth of information, and he just has profound understanding of all the interdependencies between these markets. So we cover the macro situation in the Ukraine, Russia, China, the EU, the, the United States. We cover it in-depth throughout this conversation. And of course, we also cover

Bitcoin in there as well. So without further delay, here's my chat with the one and only Mr. Luke Grumman. You're listening to Bitcoin Fundamentals by the Investors Podcast Network. Now for your host, Preston Pish. Hey, everyone. Welcome to the show. Luke, when all this started happening. I just thought I need to talk to Luke or Lynn or somebody and capture your thoughts because my Lord. We just talked recently, like how in the world has this much happened in that amount of time? It's just nuts. Yeah, it's really been something, hasn't it? It's crazy. Before we start, why in the world is Putin taking these pictures with these big long desks? It's like there's 20 seats you could put between him and these people that he's talking.

It's just so strange. It is. And it's, I don't know. No, I mean, it's, if he's reacting like, you know, half of our country's reacting to COVID, that's probably a pretty good guess, right? Like, if you were the richest man in the world like Putin was, or rumored to be, and you were a COVID germaphobe, you know, we'd probably be saying these kinds of tables everywhere all over the U.S.

So weird. So weird. All right, on a serious note, the last time we talked, we were talking a lot about the dollar. We were talking about interest rates. We were talking about how the Fed was in a no-win situation based on the spreads. And then this thing happened. And I mean, I just want to start off by saying, you know, blessings to the folks in the Ukraine in this area and all the families that are affected by this. Our prayers are with you. And God, I hope this ends in

the most peaceful, less stressful way for everybody involved. But with that, Luke, take it away with your thoughts on where we're at. Like, what does this mean? Where do we go? Take it away. Maybe I'll start at the end, right? Which is, I think that 40 years of globalization, 40 years of disinflation, 40 years of disinflation, 40 year bond bull market on a real basis at least, I think they all died on Wednesday night. I think Pax Americana likely ended on Wednesday night. I think a global marking to market of global relative power levels. appears to be happening before our eyes. And I think the way that looks is the U.S. and the EU are going to get downgraded relative to China and to Russia. And I think the multi-currency, multipolar world featuring multi-currency energy pricing, multi-currency reserves slash gold reserves, I think that system that that world was likely

fully born Wednesday night. So I think Wednesday night was, I think, a really, really big, I think it was a really, really big moment. I think we're going to look back in history and see that. When I say the relative power levels being marked to market, what I mean by that is, is look, we could sanction Russia's energy. We could kick Russia's energy out of Swift. There's no reason we can't, except there is a reason we can't.

Russia is too big a part of the energy market and we have too much debt. And that's why I say is I think there's been, you know, there's been a lot of questions. Hey, what's what's Putin's grand strategy? I think the grand strategy is basically to, to trigger a reset. I think sort of the thing that I see a lot of discussion about tactics and reason and let's set aside the possibility that he is sort of off his rocker, which we've seen some intelligence speculation via Marco Rubio on Twitter and others. Let's set that aside. It's a possibility, but it's sort of uninvestable, unknowable. So, okay, so we set that aside.

So what's the plan here? First off, I think that I don't think Putin can do this without the, if not tacit, or tacit, if not explicit blessing of Xi in China. Because this whole gambit fails if Xi walks away from Putin. Putin's done. So that's point one. I think in the aftermath of what the U.S. did with Iran regarding Swift in 2012, if you remember, we kicked Iran out of Swift or facilitated that. And the Iranian economy hyperinflated by October. And so I think Putin had to know this was coming. I think that China realizes that if Putin goes, China's next.

And I think Xi, if Xi had any illusions, if China had any illusions that the United States could not starve him to death using the Swiss system before last week, he knows now. And I think that's going to factor into his thought process. And so Putin and Xi need each other, perversely. Last week, they were already moving together. There was already this alliance. It was already threatening. It was already sort of awkward. We have now crammed them.

They are now, I think, out of necessarily. necessity sort of tied together based on what happened last weekend. And maybe more important last week, what happened over last weekend. And I think ultimately what's happening here, what the gambit is is that the reality of peak cheap energy, which you and I have talked about a number of times and prior conversations where not that we're running out of oil, but the incremental oil supplies are getting more and more expensive. ultimately, I think there's a calculus here that Putin did and that she did, which is they've been wanting to change a system for 15 years. You can go back through history. I mean, March of 2009, the PBOC saying we need a new currency system. 2014, Putin's saying the problem with the global economy is the dollar and particularly the dollar's monopoly on oil pricing.

It's killing the world economy. And there's, I mean, I could literally go through page after page after page of these examples throughout history. And so I think what I think a lot of people are missing in my opinion is that this isn't, nominally this is about what this is about. But I think the grand strategy here is very opportunistic, which is peak cheap energy means we cannot afford to sanction Russia's energy out of global markets without the global economy crashing, without the global bond market crashing. And they know that. It's pretty straightforward math

when you kind of just start doing some back of the envelope stuff. And then that context, plus the context of something you and I have talked about ad nauseum in the last couple shows, which is the fiscal position in the U.S., fiscal position in the EU, they are in no position to have a recession. If they have a recession,

they're either going to default on their sovereign debt or the money printer going to go burr in both places. And so if you have those two pieces, this information, then you say, okay, let's go for it. And you say, well, they're going to, they're going to sanction you out of SWIFT. Great. If your goal is to trigger a reset of the system where you have a multi-currency system, perfect. You know, if I have to take some pain to do that, if I'm Russia, I do it. Perfect. Like, let, I mean, it's, it's, I mean, it's, it was fascinating to me this weekend to watch the U.S. and EU central banks do what they did as it relates

to FX reserves. And I understand why they did it. I understand the strategy behind it. I'm not sure they understand what they really did, which is they completely discredited sovereign debt as an FX reserve completely. I mean, if you're China, you're looking at this going, if I look sideways at Taiwan, they're going to take away my FX reserves. And to remind the audience, FX reserves at their core are just the aggregated savings of a nation's trade over any number of years. Yeah. So that's why I say I think everything has changed now, right? And there's a lot of different ways we can look at this. There's a lot of different ways. China can respond a lot of different ways. Russia can respond. We can respond. But the bottom line to it is I think something very, very big happened last week.

these these it was I think sort of the you know when you have these processes happening right I'm always asked what's the trigger what's the catalyst how are we going to know I think we know now I think it just happened and not just that that happened but then the West's response to it is going to I think I think things are now in motion they they can't be stopped all right so I agree with everything you just said I think that uh you know the example that I've kind of been providing to people is, I think from Putin's standpoint, he was looking at this. He's looking at leadership across all of NATO. He's looking at the Ukraine and he's looking at a president who, and I'm going to brand him in a way that I think maybe Putin was looking at him is this guy's a comedian,

literally. This guy was a comedian before he became president, right? He's like, I'm just going to run the queen right down the board and I'm going to checkmate this situation. I'm going to basically take the Ukraine and nobody's going to do anything about it. It's going to be the 2014 Crimea type situation. Only this time this guy is just going to get scared. He's going to step down. There's no way that they're going to go against my Russian military, right? And he's just going to roll over looking for a golden parachute.

And Ukraine's going to be mine and I'm going to basically demonstrate to NATO that they have no response. right. They have no response and it's just for the taking at this point. And I think he, and I think he did that move. He ran the queen down the board in order to do the checkmate. And he found out that the game wasn't over and that the response was probably a 180 from what, I think a lot, myself included, you know, if I was going to give myself a grade as to how I thought this was going to play out with them with the Russian troops on the border, all the news, all the hoopla around it. I just kind of suspected that they were going to, they were going to probably get what they want and just roll in there and take it.

And there wasn't going to be too much of a response. And I'm telling you, I would give myself an F for what I thought was going to happen. Me too. Me too. And Zelensky's response has just been unbelievable. unbelievable how the Ukraine's respondent. If I was going to attribute it, sorry to just, I need to be asking you the questions. No, no, you're fine.

When I was looking at the response, I really think that in 2014 with the whole Crimea situation, I think that the Ukraine set up massive defensive positions for if this day would come. And I think anybody who probably lived in the Ukraine had a way different site picture than ignorant people like me living over here in the U.S. as to how this would potentially play out if it ever happened. And obviously it did. But I think that any time you're trying to go up against a well defended military position, it is way different than trying to attack and not accounting for the most important critical

point, especially when you get beyond like day two, logistics. I mean, the logistics footprint that's now required to sustain them, the Russians, is just, I don't think a lot of people understand how complex that goes from a military. I can only imagine. To sustain these operations that they're now in. And wow. I mean, I'm just, I was blown away when I was seeing all this information being published on Twitter of the aircraft, shoot downs, the air defense, everything. It was just, I was just

awestruck by all of this. There's a, there's no question in that. I'm doing. Other than I think, I think, I think Zolensky's response was the thing that, that just, I don't even think NATO was expecting that response out of him. Yeah, I think it's been surprising. I mean, to everybody, to everybody. It's been surprising. So here we are, I think, where are we at day six? Yeah, going into day six, right, Wednesday night. So day, day, end of day five going into day six over there.

Yeah. Yeah, and I think this is where it really starts to get interesting. So the negotiations broke down. I think that was fully expected. I don't think you go in there and have the number of casualties that you've had on both sides and expect there to be any type of agreement at this point. And I think sunk cost bias when you get into war, and there's a lot of casualties on both sides is just unimaginable how strongly entrenched I think both sides quickly become in a situation like this.

And I guess where I'm going, Luke, is it doesn't seem like this is moving in a good direction. It seems like this is going to get. And who knows? the time it airs tomorrow. This airs tomorrow. That's what could I happen. But it really seems like this is not going in a good direction. What do you think? Yeah.

I mean, to me, it speaks to sort of a fracturing of the world order that we've all come under, right? Because if China walks away from Russia, Russia's done. They've got nowhere else to go with the oil. I don't see that happening. It's not going to happen. And it can't happen because you can rest, you can almost guarantee that Putin's telling she, if she needs to be told, look, if I go, you're next. Make no mistake. They're going to, they're going to do the same thing to your FX reserves. They're going to sanction them. They're going to take them. They are going to force a coup on you. And then they are going to put someone that they want in there to run China, sort of like they liked before that.

and make sure that Taiwan is safe. And the challenge is that there's a, like you just said, there's two opposing viewpoints to what's happening here. And the two opposing viewpoints are not politically reconcilable. We're past the point where, you know, the naivete of, well, if we get the Chinese rich, then the Chinese Communist Party will change. which was sort of what a lot of the, you know, the 30 years up until now was based on and up until, you know, a few years ago at least was based on. And so you're in this weird situation where, look, when Russia defaulted in 98, the United States government was running a surplus. We were a unipolar power. China was a backwater.

You had good demographics in this country. We had low debt to GDP. We hadn't spent $6 trillion accomplishing securing Iraq's oil for China in Iraq. It was the situation. And my point is that long-term capital still blew up and still almost took down the whole system with a much more stable system. And so this, but that was back when it was not acceptable to manipulate the markets like they are today. I mean, that was, that was pre, it's just obvious that we're manipulating markets, right? Oh, yeah, right?

Like, it was funny. I think I set some on Twitter last night. I said, watch, once the PPP, once the plunge protection team shows up today, you're going to see gold down and you'll see the dollar up and you'll see stocks up. and you'll see the ruble down and you know and you know and i'm not saying the rule didn't deserve to be down uh it did clearly but you're going to see as much it down as they can you'll see russian stocks down and you'll you'll paint the picture it's this sort of managing to optics instead of outcomes um all of which is fine but then that gets back to the oil thing that gets back to the energy question you can manage to out you can manage to optics until the lights don't come on until the heat doesn't

come on. And so it goes back to your point of what's the response? Russia starts sending slowing gas to Europe, right? What happens? We've already got a German boot market that's yielding zero with German PPI at 25. And the only reason that I understand there's a whole big slug of the bond market that owns bonds because they're regulated into it or they have to or it's matching liabilities. Whatever. There's a big chunk of the bond market that is mindless buying. I get that. I understand it. But then there's a part of the bond market that owns bonds because they actually think inflation is going to come down in the second half this year. They actually think supply chains are going to get better. And after last week, I don't know how you can possibly think that supply chains are going to get better. I don't know how you can possibly think inflation is going to come back down unless this thing sort of wraps up quickly and cleanly. Let's take a quick break and hear from today's sponsors. All right. I want you guys to imagine spending three days in Oslo at the height of the summer. You've got long days of daylight, incredible food, floating saunas on the Oslo Fjord, and every conversation you have is with people who are actually shaping the future. That's what the Oslo Freedom Forum is. From June 1st through the 3rd, 2026, the Oslo Freedom Forum is entering its 18th year, bringing together activists, technologists, journalists, investors, and builders from all over the world. many of them operating on the front lines of history.

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who maybe aren't intimately familiar with the bond market. So the bond market's getting bid through all of this. Aggressively bid. Yields are down just in the past week since all this started happening.

And don't you think that some of that is just the fixed income community, just front running further central banking actions, like aggressive central bank burring into the market. I think some of it's, I think it's probably primarily safety at this point, because I still think the big aha moment or the big oh shit moment coming for Wall Street that hasn't hit most of Wall Street yet is they're going to go burr into an inflation spike. They're going to go burr in a hundred dollar oil. They're going to go burr into five dollar copper. And that, and they're going to

do that to contain yields. I mean, the yields we've seen so far, particularly in the long-dated treasury market, that makes sense, right? There is still a reflexive response. The question will then get to be when the inflation numbers get worse because of the supply chain disruptions. When, just think about the fertilizer. Yeah. Like the food prices this fall are going to have to be astronomical. Yeah, there'll be an increase and there'll be, you know, energy. You know, like I said, like the reason the bond market, you know, the reason the part of the bond market that has a decision to make about inflation is where it is is because it believes

that inflation is transitory. They believe that 7.5% CPI is going to 2 over the next year and a half. if I went to all the, that discretionary bond buyer, we'll call them, people with a choice with how they want to allocate their capital, and said CPI is going to be eight for the next five years. And if this thing goes on, it might be. It might be eight or ten. It might be 12. I don't know.

You're taking the world's biggest energy supplier. You're taking the world's factory. And you're, you're, you're, you're, you're, you're, we're in a fight with them. And I mean, the only way you don't, the only way you don't have that is if they just let the markets really sell off? Is that what would prevent us from hitting those kind of numbers? Or do the numbers still manifest themselves? No, you could, but that's, that gets been to, I think, the calculus that Putin has made in regards to this action, which is you can have the markets sell off to create a bid for bonds.

And it will. It will work. We've seen it in the last week to weeks. With that said, it can, as we saw in March of 2020, it can only work for so long until you, you, yields actually start rising, right? Because ultimately, there's a supply-demand problem without the central bank there. The thing that is so different now that Wall Street still, by and large, does not understand, that most investors still do not understand is treasury spending, which is interest plus some of the other stimulus they're doing to juice tax receipts to juice GDP. Treasury spending plus the entitlement pay goes are 100% of tax receipts, with tax receipts at all-time I mean, people say, oh, we're not spending that much on interest.

We have tax receipts of $4 trillion last year. Just the entitlement pay goes are $2.7 trillion. Before we spend another dime on anything else in the U.S. government, they're spending 65% of tax receipts, record tax receipts, boosted by a 12% nominal GDP, which was boosted by 8% inflation, $4 trillion, $65% entitlement pay goes. Then you're going to have, I mean, if you add up, $1,000. Treasury spending, entitlement pay goes and defense, which I categorize as the big three, that's 120% of tax receipts.

So and tax receipts are highly sensitive or highly sensitive to consumption. And consumption, because consumption is 70% GDP, and consumption's highly sensitive on the margin to asset prices, stocks. So that's why I say they can let stocks fall for a bit to drive money back in the bonds. But if they let it go too far, they're going to end up making the problem worse, not better, because what ends up happening is tax receipts start falling, and then you either have to let rates rise into a recession to drive more capital into bonds because there's not enough capital to go into the bonds, or you have money printer go burr. Or you cut defense in the middle of a pissing contest with Russia, not going to happen. Or you cut $2.7 trillion in entitlement pay goes in the middle of a midterm election for the boomers, not going to happen.

or you cut treasury yields below what they are. You can't go low below zero with the reserve currency. Option four is money printer go burr. And that's, I really think that's the bigger game, right? You say it's, you know, always know the game you're playing, which game you're playing. I don't think Western strategists fully appreciate the game they're playing. I think they are playing the Ukraine game. And I think what Russia and China are going is like, let's just cause chaos here.

This is like the U.S. is Afghanistan strategy, right? Like, let's just throw a Molotov cocktail in there. We're going to take some casualties. We'll get bogged down. Maybe we win. Maybe we don't. But the bigger game is, is the resulting chaos, the energy market can't take it, the bond market can't take it. The Western sovereigns in the U.S. and EU specifically, their fiscal situation, there's just there are no position to do anything.

say to the person who would look at Putin and say, well, he might not make it. Because internally in their country, I would imagine it's just rife with a populace that really isn't too excited about all this. I would suspect, but I don't know. I don't know either. I, you know, I saw Western polling ahead of time that said that I was reading the other day. I forget which media, I think it was U.S. mainstream media that said it, but the Western polling ahead of time was that Russian citizenry was in favor two to one to going into Ukraine, which if that's the case, who knows? We all know that polling is, but no, I think I think that's right, right? But again, that then if you have chaos in Russia, chaos in Russia was in 98, when literally the economy was

the economy was perfect. I mean, like nothing was going wrong. We were running surpluses. We were You know, I mean, the biggest problem the United States had in 1998 was Monica Lewinsky. Think about that. That was the big crisis in 1997, 1998. And in that environment where Russia was smaller, where oil was $20 a barrel, Russia was like hanging on. We were trying to define what is was or is. Well, that's a separate discussion. I saw someone the other day saying, well, we signed this agreement with Ukraine to defend them and to be harsh. I'd like, you signed it with Bill Clinton, who was debating the meaning of the word is. Like, that's, you know, that's dangerously close to politics. I won't.

We'll stop there. So two things for me that just kind of makes this very concerning the direction that this is going is you had Belarus shooting what would appear. And again, this is who knows how valid all of this is, but it appears that they were shooting munitions from their territory into Ukraine on, you know, obviously supporting Russia. And then you had Turkey cutting off the access to the Black Sea to the Russian Navy. So here you have two countries that are supported, one supporting Russia, one supporting Ukraine, that are now actively involving themselves into this fight. And I'm looking at this and saying to myself, oh, my Lord, like, I suspect that this. this just is not going to go over well as far as just looking at historical implications when you start getting active participants that are outside the two nation states that are at war.

It has an ability to spiral out of control very quickly. You have Chechen fighters that are now coming into the Ukraine. Who knows where else they might be deployed, depending on some of the other actors, the other actors that are involved. And I'm just looking at all this. I'm saying this just does not seem like it's going to work itself out in a quick kind of way, unless something that's just unforeseen happens, like an assassination or something that is just kind of not in the card or doesn't appear to be in the cards. Yeah, I don't disagree. And for me, it goes back to that to the point of, you know, when Russia was a lot smaller, a lot less significant, when the system was much more stable,

Russia collapsing was enough to nearly collapse the financial system. It required a Fed bailout of long-term capital to keep the U.S. banking system from collapsing, the global banking system from collapsing. And so to me, when you then factor in the China angle, you know, there was a white paper that China put out right at the end of last year that not a lot of people paid attention to called export controls. And it, you know, it read to me like a veiled threat, basically, of we will weaponize supply chains. We have to start prioritizing exports based on our own domestic use, right? So that's punchline being that best case from the financial.

I don't know on the kinetic side. I agree with you 100% that it could, what we're starting to see with some of these other nations getting drawn in has the risk of things spiraling. But I only say that based on historical analogs reading. I don't have any particular expertise in that. So I'm not the right guy to ask about that. But what I do know is when you look at the relative size,

the relative leverage in the system and these events, It just goes back to that point of disinflation. No, it's over. Supply chain improvement? Yeah. No. Inflation's going to get better? No.

And to be clear, I think what we saw from the U.S. and EU, I didn't realize this until today, but apparently Central Bank's sovereign, Central Bank, FX reserves historically had enjoyed sovereign immunity. So the fact that the U.S. and the EU central banks did that to the Russian central bank is a violation of international norm, arguably an act of war on some way, shape, or form, it is likely to elicit a response. What is that response? You know, does Russia slow steam, or slow pump the natural gas into Europe? That's probably a pretty good bet. Like, you know, do they mess with the LNG terminals from a hacking standpoint? Because if those things go down, you know, the Liberty Boats are going to all pile up in the med or in the North Sea looking to get the gas in and they're not going to be able to offload it, you know, are they going to mess with electric or cyber warfare here?

Gosh knows, we've heard plenty of warnings about that. I mean, you know, when I saw what I saw last week, I told my wife, go get some extra cash out of the bank, go to the grocery store this weekend. We need to make sure we've got plenty of stuff in the freezer because I don't think people in the West are thinking of, listen, what happens if your credit card goes down for two weeks? And Pippa Moundgren wrote a great paper, a great substack, a week, I think last week, I think it was called Electrons of the New Bullets.

But I would highly encourage listeners to read that. I think it's very, you know, Pippa, brilliant woman, not just a brilliant woman, but she served in the Bush. administration. This is, she knows of what she speaks. And of course, her father, Harold Malmgren, served with Kennedy, Johnson, Nixon, Cold War veteran at the highest levels. And her, the point of her paper is, is that electrons, the internet, you know, all of this can be weaponized. You know, the exchanges are on a chip, basically, is what she says, right? So, you know, what happened, and this is her question, not mine. What happens if,

markets stop functioning on a regular basis. Not if they go down permanently. That's not the issue. What if they're just intermittent, right? Where they you start questioning capital allocation. You start cap, you know, these these these sort of fundamental and that's where to I think in addition to the the the kinetic stuff that you just referenced, the I think the Western populace is totally, uh, unready for anything like this. mentally, physically, anything. Absolutely. I mean, my kids today, my boys, I got a 19-year-old and a 20-year-old and 18-year-old,

and my 18-year-old goes, dad, you know, going around on Instagram or whatever they're looking at, you know, Columbus, Ohio is number six on the, on the, on the, uh, whatever list they were looking at of nuclear targets for the Russians, right? So we're in Caliban, Ohio, Columbus are like, oh, my God. Now, who knows if it's even true or not? But like we, from three months, we've gone from the president of the United States saying, the unvexed are going to, you know, at risk of hospitalization and death over this cold winter, to today the president going, don't worry about nuclear attack. It should be fine. And it's like,

holy cow. Like, is that how fast everything went? Like, I just think there's this, you know, when I saw the reaction of my boys, like, I don't think mentally as a country, I don't think physically we're prepared for any type of retaliation. I mean, my whole life, everyone's whole life, it's always been over there. We're not even talking about. Canada shutting down bank accounts for people that made $50 donations to a crowdfunding protest, right? We're not talking, we're not even talking about a massive convoy that's in route to Washington, D.C. right now, to the tune of thousands of trucks. I don't even know how many what the number is up to right now, but I think this is going to be a major story in the coming week, right, or two weeks.

I think the banks in Canada had a very short, very one-sided and very loud conversation with Trudeau. That's what I think happened. But the trust is breaking down every two. Oh, agree. To your point. Yeah, of getting money out of the bank. I just don't think people, I think they've been so lulled to sleep expecting that I can just go out. And this is just how the world functions.

and I think we are in a situation where there is something massive brewing. I don't know what the hell it is, but there is something really massive brewing. It just feels like that. I mean, I hope I'm wrong. I do too, right? And I hope, and that's something to think about too. And who knows, this might have even factored into Putin's calculus, right? Maybe he's desperate.

Maybe he's what, maybe any of those things. But the Russians are no strangers to currency collapses. This is not their first rodeo. this is actually 30% in the ruble. Like, I have friends that grew up there. They had two hyperinflations in the 90s. The currency collapsed again in 08, and it collapsed again in 14. So it's like, it's not like America where everyone's just has all their cash sitting

in the bank. Everything's fine, right? I mean, you hold your currency in dollars. I mean, there's record purchases of gold last year in Russia by the citizenry. Like there's an understanding that fundamentally in Russia that currency collapses, number one, it's not safe. And number two, having lived through that, there's, you know, there's much more robust, you know, just experience, right? You store food. You have a garden.

You do, you know, there's these angles that once you live through that kind of thing, it's a little different than, hey, we've been running just in time for 30 years. what can possibly go wrong kind of a thing. And I'm reminded, too, as we get into this, right, with Russia and China, I'm reminded a little bit of the stories of World War I, right, where going into World War I, number one, there was at the end of globalization 1.0, and there was, I forget who wrote the book, but basically it was irrational to go to war because everyone was intertwined with trade. And the guy said, listen, I didn't say impossible. I said irrational, you know, in the aftermath.

he was right. He didn't say impossible. He said irrational. But the other point to that was every combatant going into World War I thought they were going to go in and be home by Christmas because they had all served in, you know, Africa and, you know, India and these colonies of the great European powers in the 10 to 15 years prior. And they had been using machine guns against guys with old rifles or spears in some cases and just mowed them down. And so, they figured, all right, we're going to go there. We're going to mow down the Germans. And to your point about the defensive positions, when they got machine guns and they got

machine guns, it was a very, very different story. And my point is that when you have two near peer adversaries, it's a very different story. And it's a very different story for us versus recent conflicts in the United States. And it's a very different story for the Russians versus near, near term. Right. So there's this desperation, I think, to some level on the Russian side, this frustration on their side. And I think some probably overconfidence on their side and on our side, all feeding into what you described earlier combined with all this other. So I think it's, I don't disagree.

It's a very discomforting cocktail. And then when you talk about the domestic side, which again, I don't know who gave Trudeau that advice. it was terrible advice because now the truck they opened pandora's box there's no going back it's it's it's been revealed it's the same thing as as when we when we use swift on on iran um i think in hindsight we will see that to have been a very penny wise pound foolish decision right 50 dollars right right i mean if you're alabama and you're playing st mary's of the blind right you don't put your best trick play on film so that ls you can see you right you save that You don't, you know, to, you know, so why are we using Swift against Iran?

It made, you know, it made little sense. We should have, because had we not used that against Iran, then when we deployed it against Russia, they'd have been like, oh, my God, right? Like, there's no surprises now. I mean, you saw Jamie Diamond at the end of today say, there are workarounds, and this is now a threat. Obama talked about this in 2015, that the reason we pulled back on some of the unilateral sanctions against Iran was because there was a threat to the U.S. dollars.

reserve status. So we couldn't sanction. We can't dictate the economic and energy policies of every nation on Earth because it will threaten the dollars reserve status. And so there's there's this direct game. There's the threats within this direct game. And then there's this big meta game, you know, of that I think is ultimately sort of the real goes like, hey, maybe we get Iraq, maybe we get Ukraine. Maybe we don't. We don't think we're going to lose tremendous amount. You know, it's, you know, we'll getting a scrap, but that scrap in a peak cheap energy world with the U.S. sovereign debt and fiscal situation and the EU debt and fiscal situation as precarious as they are, that should be more than enough to trigger money printer go burr into a energy spike and inflation spike,

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the chance for China to go after Taiwan. And I'm just kind of curious what you think the probabilities is something. I think the probabilities is higher than what many that are just writing it off saying, I think the probabilities are higher than that. I'm just kind of curious whether you think that that's an opportunity for them. If they are colluding together, Russia and China, is this the moment where they then go in that direction to really kind of lay the one-two punch? I don't know. The people that I really respect on that say that, like you said, it's basically a low chance, of happening. The thing that's caught my attention as it relates to Taiwan and China is, for example,

I saw a chart from David Goldman a few weeks ago showing that Taiwanese exports to mainland China since 2019 are up nearly 2x. By way of comparison, Taiwanese exports to the United States since 2019, according to whatever U.S. agency tracks it, are up 45%. And the United States is having a semiconductor shortage. So you tell me what the mean, you tell me, it sounds to me like Taiwan's voting with their checkbook or Taiwan is actually writing. They're playing both sides, which is what I would do too. Their economic future is clearly in China, but they want to maintain their political independence, which is clearly with the United States.

And so to me, it looks like they are, you know, the shipment numbers, the growth rates since 2019 would suggest that they are giving preferential treatment to the Chinese while benefiting from our umbrella, which to me sounds like there, maybe there needs to be a conversation there. But again, when I say this re-rating of political, relative power standings, this is another measure. what exactly are we going to do, right? Let's say I'm right. Let's say that the Taiwanese are, exactly. They are giving Chinese preferential treatment, and they are doing so under our military and protection umbrella from the Chinese. What are we going to do? Back away? No, we can't, because if they go with them, then we're worse off, right? So you look at the game theory of it. You know, Taiwanese relative power is gaining relative to America. And by very, virtue of that Chinese's relative power is gaining relative to America. And at the moment,

there isn't a darn thing we can do about it, as far as I can tell. Now, I've been very encouraged to see in the last six months, we have seen three semiconductor fabs announced in the U.S. Right? We've seen Taiwan semi in Arizona. We've seen, I think, a Samsung facility in Texas. And we've seen Intel come here to Ohio, where they're talking about making Columbus, the Columbus, Ohio region, one of the biggest semiconductor production regions in the world, which sounds awesome. And I think it's the right thing to do. I think it's very good for Ohio. It's very good for the U.S. That said, all of this is still on the come. We're still probably several years from this. There's probably some generational in terms of technology issues, whatever.

But for my purposes, again, it ties back the initial statement. This isn't disinflationary. This is not transitory. This is always. both inflationary. It's so non-transitory. It's such a, and again, the way the world worked for 50 years was, is you guys make the semiconductors, send them to us. We send you the dollars and then you take the dollars and you send them back into treasures. And now we're saying, we're out. We're just going to make them ourselves. And so here too, there's a message to the Taiwanese. I think it's the right thing to do to them to say, listen, you're benefiting from our protection. You're taking care of China. Okay, great. We're going to start making stuff here, which is the right thing to do. But then it also communicates to the Taiwanese, all right, you know, I don't know if the Americans are going to be here in 20 years, 15 years, 10 years. How does that start to change strategic thinking? I don't know. But these are the types of conversations that have to be happening around the world. And these are conversations that were not happening five years ago, 10 years ago, 20 years ago, 25 years ago. So the Russian minister says, we are working on digital one world currency for trade. Came out of the local media, I think, yesterday. Yep. Thought.

What are your thoughts on that one? I think this ties back into the relative power situation revisions. And I think it ties into something I tweeted today, which was, nominally, the Russian currency is the ruble, and it's getting killed. But functionally, the Russian currency is oil and gas, and it's rising against everything, and it has been rising against everything. And that leaves them with some unappreciated or underappreciated options potentially, right? So if we are willing to completely cut off their oil and gas, and you could never completely,

but mostly cut it off. And again, I don't think we can do that with collapsing our system. Can China and India consume their production? Yes, but the logistics are problematic for a decent chunk of it, right? So there's some pipeline consumption issues, some displacement, some grade stuff. And again, that's above my pay grade. But the little bit I've looked at is that there is a, there's not a, enough pipeline capacity to do it today. The pipelines would take a while because it's not easy

ground to build over. Presumably you could use it, you know, use tankers for a lot of it, but then I don't know the grade, you know, medium heavy, light, sweet, you know, in terms of the different refinery needs. And then who that bumps out, right, in terms of the implications of that. So top down, oversimplified, yeah, right? I mean, ultimately, this. demand for energy is infinite. I would love to take, you know, at G5, you know, Gulfstream 5, everywhere I want on vacation and, you know, consume a bunch of oil. If oil was free or very cheap, I would do that. It's not, right? So the whole, is there enough demand? What's the price, right? You'd have to, you'd first have to become a strong advocate of ESG before you did that,

Luke. I literally just saw a headline on Bloomberg talking about that the Europeans are talk about reclassifying weapons makers as ESG so that they can get cheaper financing, unlike satire's dead. No, so if we're willing to completely sanction the energy out, they have energy, they have some options, right? This is the real currency. And so people say, well, how can they defend it? Like, let's start with just basic and work our way up with their options. What if Putin came out tomorrow and said, I'm only taking ruble for my energy? Let's just think about this mechanically. The Europeans are going to, have to start selling euros to buy rubles.

And the Americans are going to have to start doing the same thing because we import whatever on net, I think 600,000 barrels a day from the Russians and whatever gas we get from them at that. I mean, Europe has no options in this. No, I'm not. At least not in the interim. Like they, whatever they would try to transition to, you're what, two years out from whatever that is?

Yeah. Which would be nuclear, I would imagine? Well, and they're talking about delaying some nukes, you know, delaying some closing of some nukes. And again, there are guys out there that know what that would imply in terms of reducing natural gas demand, daily demand, but I'm not one of those guys. And it's also important, too, Europe is shutting down their biggest natural gas field, Groningen in the Netherlands, this year. It was supposed to be shut down in 2030, then 2029. Now it's going to be shut down this year. They have to be pivoting from whatever those decisions were at this point. They have to. The Groningen problem,

is some of it is is geological. Some of this stuff is like peak oil stuff, peak cheap oil stuff, right? Like these fields all follow some version of a Hubbard's curve, or a bell curve. You find it, you produce more, you get to a peak, and then you've got on the other side. So there's some geological issues associated with groaning, and I think they could extend it. I don't know how long they could, but it's not simply, hey, you know, this isn't green. And so let's just stop doing that some of it is like, you know, this is causing, you know, ground issues, geological issues. it's not there, water cut, whatever. Okay, so the options Russia has.

Option number one, tomorrow Putin says, hey, I'm only taking rubles. All of a sudden, the Europeans have to sell euros and buy rubles, right? So now, and this is why I say this relative power side, right, the sign that we can't sanction his energy out because it'll collapse our system shows that there's some power there. There's a card to be played. So now you would be in a situation where the Europeans and the Americans are defending the ruble for Putin because we need his energy. Okay, so that's, I think, sort of tier one. You go to tier two, and these become more nuclear, right? New more options. And that's, yeah, a digital

currency, right? What if Putin comes out and says, listen, we have a gold, and I know we're going to set this discussion aside, we have a gold blockchain token, you know, digital currency here, gold bag, digital currency, and we are only taking, through this, we're only taking gold for our oil. Physical only. It's got to be on this blockchain, right? That's physical only, this digital token. And the Chinese are on board, and the Venezuelans are on board, and the Iranians are on board, and the whole slew of, you know, of usual suspects.

Now Putin can control the ratio of gold to oil that he wants to transact at and use his oil. to revalue gold. By revaluing gold higher using his oil, he's going to be creating dollar reserves for himself with his gold reserves, which he still has control over. And oh, by the way, he needs more of because the U.S. and European central banks just took two-thirds of his reserves, right? I think it's, I think I saw the number of what's 630 billion reserves and I think 130, 150 billion is sitting in gold in Russia. So he needs to get that number back up based on what they just did. Again, because he has energy, all he has to do is say, and this is oversimplification, the Chinese and I are transacting at 1,000 barrels per ounce.

And this, to me, is the nuclear option, right, on the financial side, because now this throws it back into the lap of the Americans. It's very poorly understood in the West that the Achilles heel of the dollar system is the Comax and the London unallocated gold markets. They are very highly levered, in London in particular, They're highly levered, small sliver of physical underpinning the whole thing, right? And the only way you can take the bottom jenga block of physical out is if you are a sovereign with nukes, right? I mean, a reasonable size hedge fund could create a run on Comax if they wanted to, but they don't.

There's a message there, right? So Russia says, okay, a thousand barrels in house. And this is where we're doing deals at as a result of sanctions because we need to make the gold market big enough to handle the oil market because you've kicked me out of Swift and you've hurt my reserves. Okay, and China's happy with that deal. And, you know, the Venezuelans, the Iranians are on board, too. So I have a big chunk of the global export oil market transacting in gold at 1,000 barrels an ounce. Well, the law of one price says you can't have the same price or two different prices for the same commodity. And in America, the gold to oil ratio is, give or take, 20. And so the Americans are going to have a choice at that point, right?

If he's doing it at 1,000 barrels an ounce, if we cannot, you know, basically if we don't stop trade with China and all trade with Russia and everybody else, right, there's going to be leakage through that whole system, a thousand barrels announced means the Americans have to decide if they want $2,000, right? $2,000 gold divided by $1,000, $2,000, in which case, the entire shale sector is gone. on. And now we need to start importing probably about 10 million barrels a day from the Russians, or the Venezuelans or the Iranians who are only taken gold. Or we have to write up gold to his number. Again, this is simple math. This is not where I think it's going. But 1,000 barrels an ounce,

$100 a barrel, $100,000 an ounce gold, you have a new currency system. Treasuries are no longer primary reserve of the whole thing. Gold now is. And oh, by the way, let's remark Putin's gold at $100,000 an ounce. Does he need any more dollars? No, he does not. He's got all the dollars he needs. And people say, well, he can't transact them. What's he need from us?

China, get him everything he needs. And Luke, so you're saying that this blockchain-based gold-backed system to the digital currency would be then traded globally? That's what this is purely hypothetical. But yeah, if you had maybe not globally, maybe just for energy, maybe just for energy between them. I don't know because to your point, to Bitcoin advocates' points, the problem with gold is you've got to audit it, right?

If it's on a blockchain, that is... He's controlling the ledger. It's auditable. Yeah, I mean, that's my whole... You already know where I'm going with my... Yeah, right. Right. I mean, and ultimately, I think that kind of outcome would be tremendous for Bitcoin, too.

to be clear, because this is the fire that the Western banker, that the Western policymakers have now started, that they are playing with. And I don't think they realize they're playing with this. And this is to me, when I see, like, my Twitter feed is probably 99%. Russia's screwed. We've got them down. Russia has no cards to play. You're talking about, you know, one of the great strategists at the senior political level in the world. Yeah, maybe he's just lost his mind and it's that simple. And this is a bad gambit. I just think, yeah, I think the, the way to go about this is to give them the benefit of the

doubt so that you can sharpshoot and think through all the different scenarios that could potentially play out. I think you have to. I think you have to. And people just aren't, right? There's just this, they have this energy production. And as long as they have this energy production and he is remains in power. I think your point there is very, very astute, right?

Because if you can get a Yeltsin in there and you can, you know, basically start to, you know, do what you did in the late 90s, which is, you know, there's a great article, The Harvard Boys do Russia, right? So Jeff Sachs and Larry Summers and Stan Fisher go over there. And, you know, they start sort of, you know, selling off the pieces of the Soviet. be an empire for pennies on the dollar to Western interests, then this can all sort of work out. But it's, you know, it's interesting. When you read team things, you've got to sort of put yourself in the other guy's shoes. And there's none of that being done. I mean, there's a book called genocide, Russia and the New World Order.

And it's written by a guy named Malcolm, I think it's Malcolm, Malcolm Glaziev. And Glazev, at least as of a couple years ago, was one of Putin's senior economic advisors. And this book is fascinating because he's. he lays out in great detail, great economic analysis, the case that the IMF shock therapy under the leadership of Larry Summers, former secretary of the treasury, and Stan Fisher, former vice chair of the Fed, he names both gentlemen specifically. IMF shock therapy in the Russians case did as much damage, economic damage to Russia as Hitler did in the 40s, as Napoleon did when he invaded Russia, and as the white revolution did in whatever,

1917, 1918. And so do I believe those numbers? I don't know. But do I know that a senior Putin economic advisor has run these numbers and believes these numbers? Yes. And this book was written nine years ago, right? So my read on this the whole time is not, I believe these numbers. I think they're right. My read on this book is numbers might be right, might be wrong, but they believe these numbers. And if they believe these numbers, what are the odds that Russians are going to roll over and let a NATO country next to them? You know, they are going to go to the mattresses at some point on this. And they finally just did. So I just want to go back, just just briefly, because I think the Bitcoin community would be very upset with me if I didn't go back

and readdress the gold comment. Yeah, I sort of got off topic there a second. No, no, no. This is good. But for people who are listening to this that really kind of want to understand why a Bitcoiner would be looking at the scenario that you outlined, I think that it's plausible that they could go down that path with a digital currency that they're saying is backed by gold. They obviously don't have to prove anything as to how much gold they actually have.

I'm sure that they would generically try to provide some type of audit of how much they're starting out with that would supposedly back this digital currency that could then be shot all around the world in a quote unquote trustless way, even though we clearly know that they're managing whatever ledger they've got. In my humble opinion, the term blockchain is thrown around so liberally. as if it's actually decentralized today that most, and when I say most, probably 95% plus, just hear blockchain are like, oh, well, it's decentralized. There's not anything anybody can do to shut it down, right? Yeah, yeah, yeah. When in reality, I really think that the only thing out there is literally Bitcoin.

That's actually decentralized because anybody who runs a full node, like myself and many others out there, know that. that you can't shut that down when it's when the memory to run one of these things is so small and so decentralized and we're the gatekeepers of what the ledger is, right? You get into any of these other blockchains. The requirement to house these things, I mean, it's like AWS, right? Like you have to have a web server to host it, which makes it not decentralized. The purpose.

That's right. Yeah. Let's rerun that scenario. Let's let's say, let's say he does that scenario with Bitcoin, just for, right? Let's just say scenario C, right? So it's, you know, hey, you better pay me to ruble. B, I'm going to gold. C, I'm going to Bitcoin. Okay. I just can't even imagine what that would do. Right. But it would think about the implications of that, right? Now it is truly decentralized. Now you've got oil bidding for Bitcoin. And there's nothing the West can do to stop it. There's nothing the East can do to stop it. It's, it's, I know one thing. Bitcoiners would be villainized real fast. They'd be villainized real fast.

Quite frankly, everyone would probably go into hiding because the number would be so big. Like, why you wouldn't want anyone to know you owned any. Um, the, which I, which I clearly don't. And there's many others that like me that have just lost our coins. But we like talking about, but we like talking about it. We like talking about it. Yes. Yeah.

No, I don't think, and this is something else I've talked about a little bit. I don't think China would want that though, because I think, I think we talked a little bit about this on our last show, which is, yeah. I think, I think China kicked out Bitcoin miners, not because they want dislikes. like the competition. I mean, they probably did, but I don't think that was the main reason. I think the main reason is they have a power issue. And they have a power issue because they have a water issue. And but Luke, okay, so let's pull the thread on this. I'm sorry to interrupt you. But what if they, what if China says, well, we're going to pay our central bank digital currency to

Bitcoin, right? But all of our citizens have to use the central bank digital currency. I think over there, most of them would just be like, okay, sure, we'll just use it. Like I don't think that there's, I don't think you have as many people in China that are just freedom zealots like myself and many other people inside of this country, right, that understand the implicate, the privacy implications and the damage that can be done with the central bank digital currency. Yeah, right. Politically, they just want shit to work, right? They just, as long as the system works, then they're, yeah.

And that would not be dissimilar to what the U.S. ran, right, from, with gold, from, third, whatever, 46 through 71, right? It was illegal for Americans to own. We couldn't own gold technically. But we were settling, I mean, there was a, there was a 737 flying gold discs to Saudi Arabia every frigging week, right, you know, for a number of years in the 60s for the Royal. And so it's interesting, right? That I think that would make sense. And that would, again, be another, it would be, it would be a huge Trump card that the Russians could. play. But again, they have the option to play that because they have this energy. That's that would be energy. And that's when you look at what he's doing, in my opinion, it has always

been, I think he understands the math is very clear, right? He doesn't need to report monthly numbers. He does not need to report quarterly return numbers. He just needs to look out and go, the Americans of the reserve currency, the Americans have 70 million boomers, they owe them $100 trillion, they're going to print it all. And when they do, they will have effectively stolen all the oil. I shipped to them for dollars over the years. They will via inflation. And so I am going to stop storing their bonds. I'm going to store gold. And then Bitcoin came along and has arguably done a better job. But I think that's his whole game. What's that? He stopped doing that in 2018 when he sold all the bonds he had, right? I would argue maybe that's

when he, the premeditation of all of this maybe was initiated was in 2018 when he sold all the all the bonds he had. Yeah, I think I think it's very possible. And it's been, I think they and China both have been under the gun, right? China has been running into increasing water issues, which means they're running into less food security. Russia can help address that. The Chinese in the first half of 2018 ran their first current account deficit in 20 years, right? So that I think spurred them to accelerate yuan oil, uh, you on commodity pricing, which we've seen a significant acceleration of since then because that gives them flexibility around their current account. Uh, right? I mean, people don't understand when I say that. Here's what it means. In 2018, if China would have,

you know, if China would have imported 100% of their commodity imports in yuan instead of dollars, it would have increased their current, or excuse me, their trade surplus by $800 billion. So China's dollar supplies would have gone up by $800 billion if they had paid in all euros, or excuse me, in all yuan, right? So when I say there's another lever, they're never going to do 100% yuan. It's not really in their interest and I don't think anyone would ever take it all per se. However, do 10% of that. That's $100 billion, right?

And commodity prices are way lower than they were today. So you just do 10% of your commodities in yuan, you free up $100 billion. China, yuan currency frees up the risk or ends the risk of a Chinese currency crisis. So I think they and the Russians were both working together on that. The Russians were very early in selling oil in yuan. They started doing it in 2014. You know, the Holy Grail gas deal was signed in May of 2014 between the two. The terms were rumored to be in yuan.

It was a 30-year massive deal. So I think this thing's been, I think they've realized they've needed each other. And I think why they feel like they need each other is I think they know the currency system is screwed. I think they see the reserve currency issuer owes its boomers $100 billion or $100 trillion, and it's going to print it all. And when they do, the dollar reserves, the dollar bonds these countries hold will be made worthless in real terms. I think you're exactly right. And I think most of the West, Europe, U.S., don't see it that way.

At least a lot of the political figures that are in charge. I think some of your central bankers kind of understand that this is coming off the tracks. But I think a lot of your elected officials in all of these countries have no clue that... They have no idea. They have no idea. That is happening. No. And I think ultimately that ties back to sort of initial point of, okay,

what's the game they're playing? And I think there's the game and then there's the meta game. And I think the meta game is, this system is screwed. There is no, this thing is going, you know, and post-COVID, it is really done. You know, that's where the reserve currency issuer can't cover his true interest expense out of tax receipts. It's over. It's done. He's got to print the big.

The game's over. Okay. the game is, hey, let's try to grab some territory and create some chaos. If we get some territory, great. But, like, you know, Putin, I think it was Putin who said it. I remember seeing an interview of him. I think it's him. I may be misquoting, but it was basically, if you know there's going to be a fight,

pick the spot where the fight's going to happen because that will give you the advantage. Or pick the spot where and when, right? And that's, you know, and I think it was alluding to a street fight, right? You never want to go into somebody else's country to fight if you can avoid it. But mentally, I think that might be what the metagame is, which is, listen, systems done. We don't know what the trigger is going to be. Let me talk about one. One more thing that I found really interesting was the weaponization of finance against all the high net worth individuals in Russia.

Right. I actually think that this might actually be one of the most powerful tools against Putin that could potentially cause a lot of this to transition more peacefully than the path that it currently appears to be going on. How powerful do you think that that force is? I kind of think that you start turning some of these billionaires. you start collecting their yachts, you start shutting down all their payments and things like that, you start taking their mansions and all these various locations all over the world.

I think he's got an absolute disaster on his hands internally with those actions. What are your thoughts? Yeah, I think that's, I think that's right. I think it's a smart way of putting pressure on him and making him uncomfortable. To me, it's unknowable. I don't know his relationship structure and status with these people, how much he's met with them before, saying, listen, this is going to get messy. That's, that's the, you know, to me the unknown. If he met with these guys and they are, you know, sworn allegiance and sort of a suicide pact, listen, we're going down with the ship,

we're winning or we're, you know, we're burning the boats, right? You know, if they swore together to burn the boats, yeah, but then again, you can swear to burn the boats, but then when it's actually, when it's time to light them, you know, that's a different, that's a different animal entirely, right? So yeah, I think they're, they make sense. It's targeted. It's, you know, it's interesting. I tweeted something the other day as a side note, right? If you, if you say that the small number of people, you know, get together and sort of control things and plan things, you're a conspiracy theorist, yet, what are we doing with sanctions? Targeting a small number of people to actually change something, right? Like, It's one or one of the other's true, but not both.

Luke, is there anything else that you think is a really important piece to this that I haven't asked or that we haven't covered? And before you do that, say the name of the book again. You mentioned a book there that I wanted to write down. Oh, by Glaziev? Yes. It was called genocide, Russia and the New World Order. And it delves into the shock therapy from their side of things. Anything else that we're forgetting?

No, I think the big thing is really just, you know, what's the metagame here? And I, and there's just no consideration that there even is one. And I think that's actually the real goal here is just... Totally agree with you. All right. Thank you so much for making time to come on and chat. Absolutely. And I learned so much every time I talk to you.

Give people a hand off. Definitely highlight your book. They're back behind you there for people that are watching this on YouTube. but highlight your book and, you know, your macro-thematic research that you do is just phenomenal. Thank you. Give people a hand off to some of this stuff. Sure. So, yeah, if you go to our website, FFTT-LC.com, give you an update on different research product offerings, what we're up to, etc.

You can find me on Twitter as well at Luke Gromyn. The book's over here to my left or right wherever it is on the screen, wrote those. They're a fictional. Mr. X is a fictional sovereign creditor of the United States, and the books are written in a Socratic method with me interviewing him. And so he, Mr. X is an agglomeration, if that's a word, of a number of different actual people in my mind. And so they're actually probably pretty helpful for these days in terms of understanding some of the motivations of potential motivations of what some of the bigger games on the financial side in particular. but geopolitics as well in terms of what might be afoot. Luke, thank you so much for coming on the show.

Thanks for having me out. It's great talking again, my friend. If you guys enjoyed this conversation, be sure to follow the show on whatever podcast application you use. Just search for We Study Billionaires. The Bitcoin-specific shows come out every Wednesday, and I'd love to have you as a regular listener. If you enjoyed the show or you learned something new

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