We Study Billionaires - The Investor’s Podcast Network - TIP397: The Dollar Milkshake Theory Update w/ Brent Johnson

Starting point is 00:00:00 You're listening to TIP. On today's episode, we have another very special guest for you, and that is Mr. Brent Johnson of Santiago Capital. Brent is best known for his dollar milkshake theory, which is a strong counterpoint to the narrative that the next currency crisis will result in a weaker dollar. Brent's theory highlights that the opposite might be true. In this episode, we discuss what the dollar milkshake theory is, how it's evolved through COVID, the range to watch for the DXY, aka U.S. dollar index, but,

Starting point is 00:00:30 but more importantly, at what rate of change, how supply shocks could impact the dollar in 2022, Bitcoin, gold, central bank digital currencies, agriculture, and a whole lot more. I've been following Brent for a long time and really appreciate his humility, his thoughtfulness, and his conviction. We had a lot of fun with this one, so I hope you enjoy this Dollar milkshake update with Brent Johnson. You are listening to The Investors Podcast, where we study the financial markets and read the books that influence self-made billion, the most. We keep you informed and prepared for the unexpected.

Starting point is 00:01:14 Welcome to the Investors Podcast. I'm your host, Trey Lockerbie, and today I'm super excited to have back on the show, Mr. Brent Johnson. Welcome back. Thanks for having me. Looking forward to it. Last time you were on the show was December of 2020, we're talking with Preston, and it was more of a Bitcoin discussion. I wouldn't even call it a debate because you're a supporter of Bitcoin. I think just a little bit more skeptical maybe than your average maxi. Just a little bit. Just a little bit. But what we didn't really explore in detail was your Dollar Milkshake Theory.

Starting point is 00:01:45 And we talked a little bit about the framework. And a large number of our listeners are likely familiar with the theory. But for those that aren't, I wanted to just quickly explore more of the overview of the theory itself. Because there's a lot to talk about today that will be fun to examine the theory and see how it's playing out. So before you do, I want to link in the show notes a great video I found of this. that Santiago put together that really describes and puts visuals to it. So I'm definitely going to link to that. But let's start there with the overview and dig in from there. Well, essentially what the dollar milkshake is, is how I think a sovereign debt crisis plays out.

Starting point is 00:02:23 And so there's a lot of people who, as the dollar has fallen over the last year, well, actually, the interesting thing is the dollar's out of 52 week high today. But anyway, as the dollar has fallen since March 2020, a lot of people have said that the dollar milk shake theory has been invalidated. And it really hasn't because we haven't entered a sovereign debt crisis yet. There's no question I got the timing wrong. I thought that COVID would lead to a sovereign debt crisis. It didn't. The powers that be have been able to prop up the markets with QE and bailouts and stimulus plans. But essentially what it is is that I believe once we enter a sovereign debt crisis, when debt finally matters, and whether that's tomorrow next week or next year, I don't

Starting point is 00:03:04 know the timing. But when we get into a situation where debt finally, matters again, I think that the dollar is going to rise dramatically versus all other fiat currencies. And while it will probably in the very short term be bad for risk assets, such as we saw in March of 2020, I think it will evolve into a situation where global capital flows into the U.S. dollar and therefore it flows into U.S. markets. And I think it will actually push U.S. markets even higher than we see today. Now, it doesn't mean it's going to be a straight line. It doesn't mean that it's going to be easy, but I think that's where it goes. The milkshake name comes from the fact that since the global financial crisis, central banks and monetary authorities around the world have just flooded the world with liquidity. Again, the bailouts, the QE, the monetary stimulus, the government help. And so my contention has been that for a number of reasons, the U.S. dollar will have the straw versus all the other currencies.

Starting point is 00:04:06 And for better for worse, like it or not, the dollar will suck up all that liquidity that's been provided to the markets. And sucking up that liquidity, it denies the rest of the world liquidity. And so I think our markets will be very liquid and the rest of the world will be very illiquid. And that itself, it creates this perpetuating effect that pushes the dollar even higher. And so I think we'll get into a situation where the dollar goes much higher than anybody thinks possible. Perhaps U.S. asset prices go much higher than anybody thinks possible just as that flow of capital comes in. And so we will have a situation where we may have inflationary pressures in U.S. dollar terms, even though the dollar is going higher.

Starting point is 00:04:48 And I think we will, outside the United States, we will have inflationary pressures in local currency terms, but deflationary pressures in U.S. dollar terms, which is the worst of both worlds. And so it really does become this self-perpetuating disaster, for lack of a better word. And I've always said, this is not a story that ends well. Even if the U.S. outperforms the rest of the world, it doesn't mean it will be a great place. You know, again, it's all relative. And that's what I always try to explain. It's all relative.

Starting point is 00:05:16 And so the dollar may fall in real terms, but against his fiat peers, I think it will dramatically outperform. And so then a lot of people have said to me, well, then who cares? Who cares if the dollar isn't rising in real terms? Well, it does matter. If the dollar rises, just as an example, 20% versus all other fiat currencies, that will have dramatic effects for global markets. You may think it won't affect you, but I'm here to tell you that you won't be able to ignore it. And I think that will lead to more volatility. So that's kind of a long way of explaining it, but that is the dollar mill check theory.

Starting point is 00:05:52 Yeah. So what I love about this is essentially what you're saying is that you're expecting fully a currency crisis. But the narrative you hear more often than not nowadays is that the currency is going to go lower and lower and lower. And that's the currency crisis everyone is expecting, where you're saying the complete opposite, that the dollar gets stronger and stronger. What's not clear to me, I think, from that is the Fed's ability to combat the dollar going higher and higher, which they've been doing somewhat to date, maybe not perfectly, but that's one of their jobs, right? So if, you know, say that starts to happen where the dollar does start to rise, where do you see the Fed being hindered to continue to do what they've been doing to stop

Starting point is 00:06:29 that from happening? Well, I think today is a perfect example of why it's not so easy to do to do what they want to do, which is weaken the dollar. And that is that we have inflationary pressures that are the highest they've been in 12 months, the highest they've been in 12 decades, or not 12 decades, 12 years, you know, a couple decades. And so to weaken the dollar, artificially weaken the dollar here would be to pour gasoline on the inflationary pressures.

Starting point is 00:06:55 Well, how do you solve the problem of combating inflationary pressures while also solving the problem of a deflationary force that a rising U.S. dollar has? It's very, very hard. And this is the point that I've tried to make the people. Probably the reason I've pounded the table on it so forcefully is that I just think most people have it wrong. And it's not that I care whether I'm right or they're right or I'm wrong or they're wrong. It's just I don't want people to get killed.

Starting point is 00:07:24 And I feel like in today's day and age, they think they have an idea, they think they have it all their grasp, so they go all in on it. I don't think anybody should be all in on anything. When you manage money professionally, a 5% or 10% position, that's a big position. And yet I talk to people all the time who have 50, 60, 70% of their money in one asset or one asset class or one idea. And I just think that that's wrong. And I think there's this very, very pervasive idea that the central banks have a

Starting point is 00:07:52 everything under control. And if they lose control, it will be the dollar losing to the downside. And I just think that's wrong. I think if they lose control, the dollar goes much higher. And if that happens, a lot of people who are betting on the dollar going lower could really get hurt. So I don't necessarily want everybody to run out there and change their portfolio or look like mine or embrace my idea 100% to put all their money into my idea. I just want them to be aware of it of what could happen and perhaps take a few steps along. the way to protect them against it because if I'm even a little bit right, it's going to be really bad. Listen, I may be wrong. And this is the other thing that a lot of people get wrong

Starting point is 00:08:31 about my thesis is that I will actually be better off and my clients will be better off if I am wrong. The dollar milkship theory really talks about the biggest potential risk that I see out there. And as a overall portfolio manager and somebody who is in charge of helping clients manage their overall wealth, of course I always want to figure out how we can make money. But a big part of my job is figuring out how we don't lose it. And this is the biggest unappreciated risk that I see. And as a result, I can't just ignore it. As a fiduciary, I can't just sit there and pretend I don't see it. I see it. And so I have in our different portfolios, we have devised some ways that we think will help protect against it. But again, the reality is, if I'm wrong, my clients will be fine,

Starting point is 00:09:16 because we own a lot of assets. I think the other thing is I think a lot of people think I'm just sitting in cash and not investing in things. But that's not the case. All my clients, they own real estate, a lot of them own gold. We own lots of stocks. Energy-related stocks, commodity-related stocks. We're not sitting in a foxhole just waiting for the world to blow up.

Starting point is 00:09:34 We're actually in their investing. But we just recognize that it's a risky time, and we don't think it's a time to be all in on any one thesis. I'm actually glad you touched on that because I know that you manage a smaller cohort of individuals who are independently wealthy. And there's a different strategy when that's the case, right? It's more about preservation than high growth. But that being said, sometimes when you're just looking for diversification, the yields you're

Starting point is 00:10:00 looking for, say, 5% or something conservative. But with inflation now at 6.2, as you kind of alluded to earlier, today's announcement, Well, how does that change that strategy, right? As far as you try not to lose money, but when those numbers start coming out, how do you reposition for that? Well, it's really hard. I'm not going to lie. It's really hard.

Starting point is 00:10:19 And I get this question a lot. And unfortunately, people always say, well, how would you manage my portfolio? How would you do this? And I always say, if you're my client, I'll tell exactly what it is. But, you know, as a regulated entity who is subject to both NFA regulations and SEC regulations, I'm not allowed to just give advice over the internet and say, go buy this or go sell that. But what I can say is that I think you should be diversified. I think you should be prepared for everything. The way that we have decided to largely solve it, and again, it's

Starting point is 00:10:46 different for every client. None of my clients have the same portfolio. They have similar portfolios, but nobody has the exact same solution. It depends on their age, their demographic, how much liquid capital they have versus maybe they own a business or they own a bunch of land. But in general, the way that we have decided to try to handle this is we have allocated our portfolio to a number of assets that I talked about earlier. Equities, real estate, gold. A lot of them are invested in private companies or venture capital funds. And so that, if the world continues to spend and the global economy grows and if we continue to have a level of inflation that continues to push the asset prices up, then we're going to be pretty good. But we've also allocated a small percent of the

Starting point is 00:11:27 portfolio, typically about 5 percent of the portfolio, a couple clients a little bit lower, a couple clients a little bigger, but in general, 5% of their portfolio to some asymmetric trades that would pay off if the dollar were to rapidly rise. And in that situation, we think that if the dollar were rapidly rise and were to cause another, let's call it March 2020, for lack of a better word, and the traditional assets that were already invested in get impaired and they go down 20, 30%, well, your 95% is now worth 70% or whatever it is, right? But in that scenario, the 5% that we have with these asymmetric edges, have the potential, again, there's no guarantees, but have the potential to literally go up four, five, six, seven times. That's the types of trades that we're doing.

Starting point is 00:12:09 And if that happens, then, you know, you add that 20 to 25 percent to the 70 percent, and now you're at 95 percent, or maybe you're at a hundred, you know, so you've, you've, you haven't completely avoided the crisis, but perhaps you've made it through it a little bit more intact than your peers, or, you know, you feel some pain, but you're not completely wiped out. And I think that's the best way to play it. Again, if I was new 100% that the dollar milksake theory would try, you know, it would be easier to play, but I don't know that for sure. All I know, all I can do is play the probabilities. And I think the probabilities that it happens are higher than the market appreciates. And because I think the probabilities are higher than the market appreciates,

Starting point is 00:12:50 I think buying insurance against it is artificially cheap. And so that's how you can get these returns of, you know, four, five, six X. And again, these are potential returns. There's some no guarantees, past performance, no guarantee of future performance, all that kind of stuff. But the point is, is that, you know, over the last month, volatility hit its lowest level over the last couple of years. It was like 14, 14 or 15. Same thing with currency volatility, not just equity volatility, but currency volatility. Volatility across the number of asset classes is the low as it's been in a couple years. The time to buy insurance is when it's cheap, right? And that's when you should be adding. And so we have had a number of clients who have done

Starting point is 00:13:28 very well in their equity portfolios, who've done very well in their real estate portfolios, who've done really well in their Bitcoin or gold, and they are reallocating some of their profits that they've made over the last 18 months into the hedges. Is that the right decision for everybody? Not necessarily. But the point is, is that even despite the fact that the hedges have not done well, they've not done well at all, which they shouldn't do. They shouldn't do well when the overall world is doing well. They're designed to do well when the overall world does poorly. And so we've had clients take some of the profits from their traditional portfolos and reallocate it to more of the hedges. It's just kind of topping up your insurance. It's like you pay

Starting point is 00:14:07 your insurance on your car every year. You know, the premium comes out. You have to pay the premium. Maybe insurance on your house or whatever it is. It's kind of like that. And I think that's the right way to do it. I'm not an all or nothing guy. I don't think you should go all in on one thing. But I do think that you should have the courage of your convictions, but you should also have the hubris to understand you're wrong or you could be wrong, right? And that's kind of what we're doing. Let's talk about the courage of your conviction a little bit because, you know, it was tested back in March, as you mentioned.

Starting point is 00:14:35 And for a minute there was playing out as predicted, the dollar spiked quite a bit, but then ever since has been waning and waning. Has that fundamentally changed anything about your thesis for you? Are you seeing, did you learn anything from that? You're now pricing into, you know, the future performance of the dollar? I don't know that I've learned anything new, but it maybe solidified some of the things that that you've learned in the past is that one is you just never know, right? There were people who in March, February, March 2020,

Starting point is 00:15:03 who were just absolutely convinced that we were going to go into a deflationary spiral that would match, you know, the 1930s. And you know what? That didn't happen. It didn't. You can say, well, it will, and it's going to, but the fact is it hasn't yet. And to a certain extent, it gave me an appreciation for just how well these monetary authorities and apparatchiks, for lack of a better work, can keep the plate spinning.

Starting point is 00:15:25 I mean, you kind of have to give it to them, right? It's pretty amazing that they could, they know, same in Europe, same in Japan, same in China. They've been able to pull the levers that have kept the wheels turning. And I don't like it. I don't necessarily condone it, but I kind of appreciate it. And so, but the interesting thing is that because if the dollar milkshake theory never happens, it's likely that my reputation will take a little bit of a hit. But you know what?

Starting point is 00:15:51 I'm okay with that because as long as my clients are whole and they're making, money, that's my job. My job is not to pump up my reputation. My job is to protect capital and grow it. I think that being aware of this potential problem will actually help us in the future. But if it doesn't, again, that's going to be okay. What I really think is interesting is that, and I actually just tweeted this out a little bit ago, is like today the dollar is at a 52 we got. It is at the exact same level it was on March 9th of 2020. So a lot of people don't remember this, But at the end of February of 2020, the dollar was around 97 or 98. And the biggest conviction trade of the year was that the dollar was going to go lower.

Starting point is 00:16:33 And in the first two weeks of March, it did. And so everybody said, see, here it is. You know, the Fed cut rates in order to combat COVID. And the dollar fell in 94 or 9460 or something like that. And everybody said, see, the dollar's going to zero. So the Fed's got it under control. And 10 days later, the dollar was at 102 and the world was on its knees begging for dollars. everybody needed swap lines.

Starting point is 00:16:54 Everything was getting sold for dollars. And so that's how quickly it can happen. Now, again, I wish I had the silver bullet or the crystal ball that told me exactly when those days were going to happen. But I just don't. And so because I don't know the date, I have to be ready for it. Now, since that day, since March 9th of 2020, the U.S. government has bought $120 billion a month in bonds. So I said, what, $1.8 trillion? You know, they've done numerous stimulus plans.

Starting point is 00:17:21 infrastructure plans, bailouts, PPP loans, et cetera, et cetera. And the dollar today, despite all of that, despite all of that firepower that they've thrown at, the dollar today is the exact same place it was on March 9th of 2020. So the point I guess I'd like to get across is, you know, for the last year, the most popular meme is money printer go burr, right? And listen, you know, assets have gone higher, dollars have gone higher, gold's gone higher, you know, Bitcoin has, you know, gone through the roof.

Starting point is 00:17:50 a number of these coins have gas prices have gone higher, natural gas prices have gone higher. But the dollar hasn't collapsed the way everybody thought it would. Now, people will say it's collapsed versus assets. And yeah, I've never said not to own assets. Never once. If you actually listen to what the milkshake theory says, it actually says to own assets. It just says to own them in North America and own U.S. assets. And so to a certain extent, I'm kind of encouraged that I'm not completely wrong because if they've printed one and a half, two trillion dollars in the last 12 to 18 months and the dollars right where it was when they started, how much effect did it really happen? I like it. So speaking of assets, because I'd like to go there, that was one of my

Starting point is 00:18:31 questions around, is it already happening, right? Because real estate in the U.S. is up so great. And the question that just arise from me, given that statement, was how do you then explain the Bitcoin performance? Because it's tripled, I think, since the last time you were on the show. And at that point, it was still relatively, I think, at near all-time highs. So that, that That's a global asset, right? So is that sucking up any of this demand that wasn't there before? No, so, well, it really wasn't there before. There's no question, in my mind, there's no question that Bitcoin has benefited from, you know,

Starting point is 00:19:06 all the stimulus plans, all the bailouts, all the money printing. Now, I already want to describe that. And I think it is to a certain extent taking some of the lure away from gold. Gold's had a big update of day, but it's no question that's trailing Bitcoin over the last year. And to your point, isn't it already happening? And I would say this happening. Fund flows into the United States from outside the United States is through the roof. U.S. equity prices versus the emerging market equity prices are through the roof.

Starting point is 00:19:31 You know, the dramatic outperformance, you know, despite everything that's been thrown at it, treasury yields are below 1.5%. The interesting thing is I think a lot of people, when they think about the milk trick theory, they just think about the dollar going higher. And from that perspective, it really hasn't. It hasn't clasped, but it hasn't really gone higher. And so they think just about the deflationary hedges that we have in place, right? But that's only, again, the deflationary hedges are only part of the overall theory.

Starting point is 00:20:00 The overall theory says to own assets because the U.S. is going to outperform the rest of the world. And that's exactly what's happened over the last 12 months, 18 months. So I do think it's already happening to a certain extent. I think it will continue to happen. And again, I don't think it's going to be easy. I'm not going to say that we're just going to sit here and, you know, equities are going to continue to go higher. Bitcoin will continue to go higher. Goldwood continue to go higher.

Starting point is 00:20:24 And there won't be any scary drawdowns along the way. But I just think that's how it ends up. And so I think not only is it already started, but I think it will continue. 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 few. And every conversation you have is with people who are actually shaping the future.

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Starting point is 00:24:51 even more maybe than 2020. Is that what we've seen, or has there been a surprise, either upward or downward from your prediction a year ago? I mean, I think that's what we've seen. I mean, they've continued to do QE all throughout the year. Here's where it gets a little interesting. and we don't have time to break it all down completely,

Starting point is 00:25:07 but we get into the whole our bank reserves money thing. And QE provides banks with bank reserves. They don't actually create money. I'm just going to leave it at that and let people make up their own minds because experts on each side disagree. But what they have not done is what they have not continued to do at the same rate is put money into people's accounts, the stimulus plans, the PPP loans. And the point I was always trying to make was that it's easier.

Starting point is 00:25:39 Financial repression is easy in theory. You print a bunch of money, you hold interest rates low and you get inflation higher. Very easy in theory. It's not so easy in real life. You know, I'm sure the government overall would love to spend more money, would love to get more stimulus fines. There's probably a ton of senators and congressmen who are pounding their desk. Why can't we do this? But there's a couple senators who are saying, no, inflation's a problem.

Starting point is 00:26:04 If we print more money, inflation is going to be even worse. And those people are pushing back hard enough that the rest of the government's not able to pass these stimulus plans. So they passed huge stimulus plans last year, and everybody said, oh, they're just going to continue to print. They're going to continue to spend. Well, I think that they eventually will. But again, it's not so easy.

Starting point is 00:26:23 Like, there is political ramifications to doing that. And so now you've got some pushback on it. And a lot of times there's a whole, they need cover. When I say the politicians need cover in order to pass these huge spending plans or, you know, introduce these big programs. And last March, they have a lot of cover, right? We've got the depression on our hands. We've got a global pandemic.

Starting point is 00:26:48 You know, they basically had the keys of the city. They could do whatever they wanted. Well, that's not the case right now. Everything's at its high. And inflationary pressures are high. And so the middle class is getting squeezed. And so the senators and the congressman of some of these states with a lot of blue collar workers are starting to push back a little bit. And so I think if they don't keep spending, then the inflationary pressures start to wane.

Starting point is 00:27:10 And then you could even get some deflationary pressures. And then that would give them the cover to come back in and push it higher. So I think that's kind of what we're going to have. We're going to have this push and this pull and this push in this poll. And I've said a couple times now that I think you absolutely need to understand the arguments for inflation. You absolutely do. And I think anybody sitting here and saying we haven't had inflationary effects for the last to 12, 18 months is just not being intellectually honest.

Starting point is 00:27:35 I think we have had it. The question, though, is whether it continues and whether it continues at the same rate. I am of the belief that it will not continue at the same rate. But it might. I can't rule it out. But I also completely understand the arguments or how it could reverse. And regardless of which side you fall on, I think we're out of time where you need to understand both sides of the argument, because I don't think it's as obvious and as big of a

Starting point is 00:28:01 given as many others do. I think what you're talking about there is the fact that, as you've put it, the banks are more or less policing the system, so to speak. So that is stopping people from getting that newly printed money, if you will, into the hands to spend. But there are some really creative ways. I think that they're almost avoiding headlines to some degree by getting really creative to get money in the hands. And what I'm talking about, most recently, is the fact that through COVID, they extended an EIDL loan to businesses, and it was a COVID EIDL loan. And that was capped at $500,000 for most businesses. Now, most businesses were capped below that, but that was the cap at the time. They recently just increased it to $2 million,

Starting point is 00:28:44 right? So now you have a lot of zombie companies that are getting more access to really long-term, really cheap debt. I mean, 30 plus year, you know, credit lines. To me, from what you're saying, is an example of maybe ways we didn't think before how the Fed could continue to keep pushing this down the line. Does this example kind of make you rethink a little bit more about the actual timeline of this happening in just how far they can keep pressing this out? Well, I think they will continue to keep pressing it out. I think they will keep coming up with ideas like this.

Starting point is 00:29:15 I think that they will do PPP-type loans again where the government guarantees them and they'll say, you know what, you need to fund this Green Project. and the banks you have to loan to this group of people, and banks you have to loan to this sector. I'm relatively certain that's going to come along. I'm not certain about anything, but I have a high degree of confidence that that will eventually come along. What I don't have a high degree of confidence in, if that will just happen from here, or whether we have to experience some more pain that gives them the cover to push those through. There's a guy named Russell Napier, one of my favorite analysts, and I just did an interview with him.

Starting point is 00:29:50 I did it in a year ago, and I just did one recently. And this is kind of his thesis. He thinks that the monetary genies out of the bottle that Congress has realized that they can control monetary policy rather than the Fed and the banks and that they will use that newfound power. And I tend to agree with him. Where he and I kind of diverge a little bit is this idea that they'll just do it automatically. Again, I think there needs to be some pain that allows them to do this. And I don't think it's as easy to do as perhaps he thinks it is.

Starting point is 00:30:19 But conceptually, this is kind of what I think is going to happen. And this is how the world is going to continue to create stimulus. The government's going to continue to spend. They're going to continue to borrow. But the other thing that we haven't even talked about yet is that this is not just happening in the United States. The same thing is happening in Japan. It's happening in Australia.

Starting point is 00:30:39 It's happening in Canada. It's happening in Europe. It's happening everywhere. The Fed, let's just say over the last 20 years, the Fed's balance sheet has gone up like eight or nine hundred percent. You know, so is China's. Canada's has gone up 1,000 percent. Europe's gone up 1,000

Starting point is 00:30:54 percent. So we're not doing this in a bubble. And so, again, the fiat currencies, the dollar, the yen, the euro, the yuan, they trade relative to each other. They're not an absolute value. So they could all be falling versus assets, but one of them is going to outperform all the others.

Starting point is 00:31:12 And it just so happens because of the design of the monetary system. If the dollar outperforms all the others, really bad things happen. We don't, again, we don't have time to go through all the mechanics today, but that's just the way it works. The world is on a global dollar standard. And as long as it grows, everything's fine. If it ever stops growing, or God forbid reverses, goes into reverse gear. That's when you get the dollar milk shake theory.

Starting point is 00:31:38 And that's when the dollar starts running away to hire and it creates suspicious circle. And so, you know, to your point, I have no doubt that governments, and politicians in Montere, they're very creative people. They're kind of magicians, really, right? And who's more creative than magicians? And so, you know, I think that they will continue to do these things. Like, I just am not convinced that they're not going to have a tough road of it. I think it will be hard.

Starting point is 00:32:05 And, you know, the other thing is that a lot of people maybe either or don't remember or forget, it was about 10 years ago, eight or nine years ago, when we had the Arab Spring across Northern Africa and into the Middle East, that was caused by rising food prices. and rising energy crisis, that kind of economic stuff ends up having social ramifications. And you're already, and you know, you combine it with COVID and the lockdowns of COVID. And, you know, people are, people are on edge. And you start getting these social reactions to economic issues.

Starting point is 00:32:35 And that creates a whole new ball of wax for the politicians that they have to deal with. I know I'm kind of pontificating here a little bit, but I guess my point is I kind of feel like we have this perfect storm. And this perfect storm, I think a lot of people believe, ends up with the dollar. going lower. And it's just my belief that the perfect storm leads to the dollar going higher. And if the dollar goes higher, we're going to have a real mess. So I just can't ignore that. You know, again, I just can't, I can't rule that out. And if I'm even a little bit right on it, it has dramatic implications for the rest of the world. Well, the way you say that, right, it can sound sometimes do me and gloomy. But when I've heard you talk about DMT playing out,

Starting point is 00:33:15 I've also heard you say that it would provide spectacular opportunities, right, especially the knock-on effect. So could you outline just a couple of those potential opportunities that you think could be available to people if they're aware of it? Sure. I mean, again, it kind of depends on what your scope is and what you're, as far as from an investment standpoint. But I think that we're going to have, again, incredible inflationary effects in local

Starting point is 00:33:38 currency terms all over the world and then massive deflationary effects all over the world in dollar terms. So if you have an economy like Australia's or Canada's, where it is highly dependent upon low interest rates and to a certain extent dependent upon US dollar funding, and you have a real estate market that has just gone up that makes the US housing market from 2008 look like child's play. If interest rates in those countries ever start to rise, well, if inflation starts to rise in those countries, which it is, and the way you have to combat inflation is rising interest rates, well, then those economies become in a lot of trouble. So I think that there will be market dislocations in Australian and Canadian real estate.

Starting point is 00:34:27 And so that could create an incredible opportunity for somebody who's not invested there and who has some drive out or to go buy some assets on the cheap. So that's an example. I don't think China is in as good of economic situation as many people think. And I think Hong Kong is not in as good a situation as many people think. And I think it's very possible that the Hong Kong dollar peg breaks. Again, I don't have time to go through the whole mechanics of the Hong Kong dollar peg. But if that happens, that will be a massively deflationary event.

Starting point is 00:34:58 Because the reason the currency would get revalued lower, so China is dealing with a massive real estate bubble in China. And they have massive internal deflationary pressures as a result. The reason the pressures are really deflationary is because they have pegged their currency to the U.S. dollar. One way for them to alleviate that pressure would be to remove the peg. That would allow them to import inflation, which they need to combat the deflation. But if they import inflation, then they are deporting deflation. If the Chinese yuan or the Hong Kong dollar peg were to break and that massive deflationary wave rolls out of China to the rest of the world, you are going to see asset prices get dislocated.

Starting point is 00:35:40 whether it's commodities, whether it's stocks, whether it's real estate, you know, a number of different things to do. We would likely have another event similar to March 2020. Maybe asset prices go down 20, 30 percent in a relatively short period of time. But again, I think that would be an opportunity to go in and buy those. If you have some dry powder, if you had some hedges, if you had something on the side of your portfolio that was prepared for that type of an event, you can use that dry powder to go in and buy some discounted assets. Because I think subsequent to that, We would have another, you know, the same way we had the massive deflationary event in March 2020, from April onward, we had this massive government stimulus all over the world.

Starting point is 00:36:19 That same thing will happen again. There's a lot of people out here who think that the central banks should not have done of what they've done. They should not continue to do what they're doing. They should not continue to hold interest rates lower. They should not continue to do QE. And that's all well and fine to have that position. But you kind of have to play the world as it is. and central bankers, the reason they were created was to step into exactly that type of situation

Starting point is 00:36:44 and prevent it from happening. So to think that they're not going to do it, it's just you've got a block there. You've got to get past that. They are going to do it. That's the reason they were created. And if for some reason, you know, Jay Powell got religion and said, I'm not going to do it. Two days later, he'd be voted out by an act of Congress. And they'd put somebody else in his place and that person would do it.

Starting point is 00:37:05 Right. So, you know, if we do have any more of these deflationary shops, they're going to be met with even more stimulus than we had last time. More green projects, more QE, more fiscal spending, more infrastructure. That's just kind of the nature of the beast. And so you start having, and then, you know, if you've got these inflationary and deflationary pressures and it's all over, you're going to get social problems, right? And so whenever there's crisis, there's opportunity. And that's what I mean by there's going to be great opportunities. And again, because I think that the dollar is going to go much higher than many think possible,

Starting point is 00:37:39 I can envision things happening that just nobody thinks possible. People will laugh at this, but I think the yen will go to 150 or 200. Nobody thinks that's going to happen. I think it's going to happen. And if I'm wrong, I'll be fine. But if I'm right and I have a few even tiny bets that happens, you can make a killing on that. And again, maybe those asymmetric bets don't pay off, but it's such a small part of your portfolio that if it doesn't pay off, it doesn't kill you. Let's take this to Bitcoin as an example.

Starting point is 00:38:07 How many times have I heard, why don't you just put one or two percent of your portfolio into Bitcoin? What's the worst that can happen? You lose one or two percent. Okay, I can get behind that idea, but Bitcoin doesn't have a monopoly on that idea. You can put one or you two percent of your portfolio in a number of asymmetric bets. And if they pay off, your one or two percent can become 10 percent or 15 percent. Now, again, these things don't happen that often. That's not a typical return.

Starting point is 00:38:32 You typically don't get a 10 or 15 or even a 5x return. But every now and then you do. And if you have a small bet on it, that small bet can really help you out. Again, it's an insurance policy. You know, I don't know anybody that buys an insurance policy and plans on wrecking their car that night. I don't know anybody that buys homeowners insurance and hopes that their house burns down, right? Unless you, you know, you need insurance money, I guess. But the point is is that, you know, when insurance pays off, it's an asymmetric event.

Starting point is 00:39:00 It typically doesn't pay off, but in that one time when it does, you are really, really glad you had it. I want to touch on what you said earlier about this all coming to a head when debt finally matters, because it kind of goes to another point you just made about the whole effort between central banks being coordinated, right? They're all in this together, so to speak. So if they're all in this together, you know, I would say that debt finally matters when the U.S. loses its credit worthiness. But when you examine the landscape and you say, well, look, the entire world is doing this, as you said, and everyone's lost their credit worthiness. You know, where are governments then going to lead to? You mentioned China, so maybe we go there next about their digital currency. You know, is that the solution in their mind as to where to go from once everyone's lost their credit worthiness? I think that's probably right. I think that they realize, first thing I'll say is this whole de-dollarization idea. There's no doubt that the world wants to de-dollar rise. It's just not as easy as many people think it is.

Starting point is 00:40:05 And we can get into why that is. But as it relates to China, I think China especially would love to get out from underneath the dollar because they realize to a certain extent the dollar is a prison. It's a prison not of your own making. And without a doubt, China has ambitions to become the global hegemon. And even if they don't outwardly say it, anybody that lives in China kind of has that in the back of their mind. that this is our time. We're ascending. The U.S. Empire is descending. It's just a matter of time before we take over and da-da-da-da-da. And that's aspirational. It doesn't have to be a negative thing. I would say that that's a common theme over there. And, you know, so for them to do that, they've got to get out from underneath the U.S. scholar. They just can't do it with the dollar yoke around their neck. So I think them rolling out this, the digital yuan is their plan for how to try to do it. And perhaps what they say is they convert the regular U-W-on. into the digitally yuan. And then they say, anybody that wants to do business in China, you have to own digital yuan.

Starting point is 00:41:03 And then with the digital you want, maybe it's easier for them to bypass the dollar payment system. You know, maybe they don't have to, you know, be part of the SWIFT and transfer money from, you know, if they want to do business with Russia, it doesn't have to go through a U.S. bank. Well, maybe that's not a good example. Russia and China do some business directly with each other. But the world as a whole, whenever they do business, it goes through a U.S. correspondent because of the US dollar payment system.

Starting point is 00:41:28 And so I do think there's, see, there's no question in my mind that countries around the world, not just China, but these countries around the world are going to continue to try to de-dollarize. I just think it's too little, too late. And here's the problem that a lot of people I think miss. Maybe they don't, but it's my impression that they miss is that it's not as easy to walk away from two things. one is all these countries have U.S. dollar reserves, right? So if you're walking away from the dollar, that means you're kind of blowing up some of your reserves. Now, even if you are, let's use Bitcoin as an example. I know a lot of people that watch your program, you know, are heavily

Starting point is 00:42:09 into Bitcoin. Let's pretend that you have 80% of your net worth in Bitcoin and 20% in US dollars. Well, even though you like Bitcoin better and even though you think Bitcoin is you want a lot higher, you don't go home, throw gasoline on your pile of dollars and throw, you match on it. You still want that 20%. You know, you don't want to just go up in flames. That's the same thing with countries' reserves. You know, they don't, you know, they have a lot of money in dollars. And so for them to go to a system that doesn't use dollars potentially decreases the value of their reserves, right? And so it's kind of a tug of war for them, you know, to a certain extent for them to leave the dollar, they're going to have to cannibalize some of their assets. So it can be done,

Starting point is 00:42:51 but it's just, it's hard. The other thing that I think many people miss is, is the euro dollar system itself. Now, this is when, you know, entities outside the United States borrow in dollars. So if a manufacturer in Brazil wants to issue some bonds in order to buy some machinery, they'll do it in, a lot of times they'll do it in dollars. Or, you know, another country will, they will issue bonds. And China's issued a lot of bonds in dollars. And the reason they would issue in dollars is two things.

Starting point is 00:43:23 One, they get paid in dollars, so now they've got their liabilities and their assets are matched. But secondly, is they get a lower rate. If you issue a bond in dollars, you pay a lower percentage rate, right? Well, in another case, that's the case if they issue a bond, but they can also go to a bank and get a loan. So as Turkey has a lot of dollar loans. And I think a lot of people think, well, these loans will just get defaulted on, and that will hurt the U.S. dollar, it will hurt. to the United States and then all these other countries will move to a different currency. But what they're missing is that those dollars aren't owed to the United States.

Starting point is 00:43:58 You know, the dollar debt that Turkey owes, a lot of it's owed to France or Italy or Spain, European banks. So in other words, entities outside the United States loan in dollars. That's the euro dollar market. And that dollar market is bigger than the U.S. market. So these loans that would get defaulted on, it doesn't hurt the U.S. it hurts the rest of the world who's defaulting on their own assets. So again, I'm not saying it can't be done.

Starting point is 00:44:24 It's just a lot harder to do than many people realize. And so, you know, if you were loaning somebody money and you found out that their reserves or the money in their bank was quickly falling and that their brokerage account assets were quickly falling, you might change the lending terms a little bit, right? And so that's what a number of these countries would be faced with. If they started blowing up their dollar reserves, funding for them doesn't get easier, it gets harder.

Starting point is 00:44:52 Anyway, that's a long ramble, I apologize. That's great. What's your take on this idea that perhaps instead of the U.S. dollar being dethroned, so to speak, it's more of the underlying World Reserve asset, a new World Reserve asset that takes place. So instead of the U.S. treasuries being the current default or oil, even in some regards, there's something else that replaces. You mentioned Bitcoin doesn't have a monopoly on that kind of prospect.

Starting point is 00:45:18 What's your other idea that could replace maybe gold or, you know? Yeah, I mean, my guess is this is going to end in some kind of a reset. You know, whenever debt matters again and the debt just can't be repaid and it has to be written off, we'll get some kind of a monetary reset. Now, again, whether that's two years or now, 20, I actually think it will take longer to get there than many people think, but you have to be ready for it at any moment. My guess is that it would be some kind of a basket of global currencies and maybe in that basket that would be gold and oil. I personally don't think Bitcoin would be part of it, but who knows?

Starting point is 00:45:51 I think we're going towards digital currencies by countries. Countries, again, whether you like it or not, there's legal tender laws for a reason because they need you to use their currencies. Governments do not typically react well to private market competitors to their money. Now, they haven't really bothered Bitcoin too much. And to the extent that they have tried to bother, it hasn't really mattered. But if it ever were to really seriously challenge them, I think that they would take excessive and perhaps excessively excessive steps against it. My guess is that we would eventually move to some kind of global solution or new system.

Starting point is 00:46:30 But here's the other thing that I think it's important to talk about this here, because I think, again, there's this thesis out there. There's this idea that China has secretly been stockpiling gold, as have all these other countries and that they're going to go back to a gold standard and that's going to kill the dollar and you know the u.s will begin ash heap and they'll be living you know in paradise again it just doesn't typically work that way and not only that but the u.s has more gold than anything so china decided to back their currency with gold and you know for china to do that uh i think the uh actually somebody's been asking me to update these numbers but i think the numbers around 14 or

Starting point is 00:47:08 15 000 for back their currency and it's about the same number and it's about the same number for the United States. So if China wanted to back their currency with gold, we could just do the same thing. We'll back ours with gold too. So it's not like they can play this part and then we're just out of luck. And finally, the thing I would say that most people have the biggest problem with me saying is that typically when a monetary regime changes, it's because the military regime changes. You know, you look throughout history, typically the global reserve currency is issued by the global hegemon. And that's because the global hegemon typically enforces their will on the rest of the world. And this is the way you're going to do it.

Starting point is 00:47:47 And people will say, yes, but the U.S. has been a bully for 80 years and they've, you know, used up all their good faith and people are sick of it. And, you know, I don't disagree with you. I totally agree with you. But, you know, whatever you think of the U.S., we do have a lot of advantages. We do have a lot of assets. We have a lot of military hardware. You can say that we haven't won a war in 50 or 60, 70 years, and I would probably counter it and say,

Starting point is 00:48:12 did we really want to win those wars? Or did we just want to go over there and blow a bunch of stuff up and then build a bunch of new tanks and ships and airplanes and keep the machine going? But the point is, is power is never just handed over, right? To think that the U.S. is going to lose the global reserve currency without some kind of military action, I think, is naive. not impossible. I can't rule it out, but I just think it's really naive. And I think that before we would lose the global reserve currency, I think that we would use every last tool in our arsenal. Unfortunately, that will be military as well. Again, I don't want this to happen, but that's just the way I see it playing. And I think that there are more countries who would go along with us than many people would like to believe. If it really came down to a choosing between China and the U.S., I think most of the world would choose the U.S.

Starting point is 00:49:00 Well, maybe not coincidentally, you know, our biggest expenditures essentially on military. And that speaks to the fact that, and I've heard, you know, I've read Lynn Alden's work on this about the U.S. needing to continue to supply the world with dollars, much like the dollar milkshake theory, then inevitably continues our deficit spending, right? It just, there's no way to rebalance. And so in that sense, the only thing we can do is say, well, at least we'll just keep bolstering on military for this event that I think you're kind of alluding to would inevitably happen. I mean, there's two ways to think about money, because essentially that's what this

Starting point is 00:49:34 comes down to. It comes down to money, and will people still accept your money? And ultimately, if money loses confidence or if people lose confidence in the money, the value's gone. It's just once it's gone, it's gone. It's really, really hard to get it back. And so there's two different ways to instill that confidence. One is just through a market solution, you know, somebody's currency kind of, you know,

Starting point is 00:49:57 people traded and they bartered and then, you know, one kind of commodity became the most commonly used and, you know, through time and it ascended to become money. And a lot of people will say that's why gold is money. And I don't have a problem with that view. I actually have deep sympathies for that view. But the other way money comes about is when the sovereign just says, this is money. And this is what you're going to use for money. And at the end of the season or at the end of the year, you only this much of this. And so that becomes money because everybody needs to pay the sovereign at the end of the year. So it's kind of like the second. secondary token that they pass amongst themselves and everybody accepts it because everybody needs it at the

Starting point is 00:50:32 year to pay the sovereign. Right. And the way the sovereign enforces that is through violence. Again, this gets a little philosophical, but that's the truth, right? You know, you go back through history, more often than not, gold has not been money. Or perhaps gold has always been private market money, but we've had, we've been off of a gold standard more often than we've been on a gold standard throughout history, various parts of the world. And, you know, again, the, way this gets enforced is force, right? And I wouldn't rule out the idea that the U.S. would call all of its allies and say, listen, we are going to issue this many treasury bonds this month and you're going to buy them. And it sounds kind of silly, but that's kind of the tribute,

Starting point is 00:51:16 right? You pay tribute to the king. And as of right now, the dollar is still the king. And, you know, I even perhaps, you know, am sympathetic to the idea that the king has been a, you know, despotic ruler and, you know, is perhaps due to go. But the king doesn't see it that way, right? And the king will use everything in his power to remain there. And I just, I think the idea that the U.S. is just on its knees and two steps away from leaving through the back door. I think it's just completely wrong. Let's take a quick break and hear from today's sponsors. No, it's not your imagination. Risk and regulation are ramping up. And customers now expect proof of security just to do business. That's why VANTA is a game changer. VANTA automates your compliance process and brings compliance,

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Starting point is 00:55:21 And this is, it's interesting that you brought this up because I've talked about this with a few people is that one of the things that you learn from history is that no great power ever lasts. They eventually fall. But what you also learn from history is another great power rises and takes over. I can't think of any time in history other than perhaps the pre-revolutionary United States or even post-revolutionary United States. Very rarely haven't you had a big area of the world who's really been free to do whatever they wanted. typically somebody is ruling over that area. You know, and sometimes, you know, some rulers give more liberties and some give less liberties and some are nicer and some are more mean.

Starting point is 00:56:02 But typically there is a ruler. There is an authoritarian saying, this is the way we're going to do things. And so I think that there will still be central banks afterwards. They may be acting a little bit different form. They may be overseeing digital currencies rather than paper currencies, but I do still think that central banks will be around. So given your theory, I imagine you keep a close eye on something like the DXY or, or maybe you have other metrics, but the DXY, as you kind of mentioned, being where it was,

Starting point is 00:56:31 pre-COVID, is there a certain number that you start measuring or looking to to say, okay, now we're in trouble? What would that number look like? Yeah, well, we're getting pretty close to it. Honestly, I think between 85 and 95, they really don't care. I think if the powers that be, if central banks working together could keep the dollar between 85 and 95 for the next 10 years, I think they'd overall be pretty happy. I think they'd prefer it between 85 and 90. But I think at 92, 93, even right here at 95, I don't think they really care that much.

Starting point is 00:57:04 But you get much above here. You get into the 95, 96, 97. That's one of the, now you're starting to get close to where it really starts to hurt. You know, I think, again, even at 95, 96, not that bad. But the point is you're starting to get close to the point. where problems start to happen. And probably what's more important than the actual level of the dollar is the speed at which it's moving there.

Starting point is 00:57:27 Again, you know, we go back to last March. You know, you went from 97 or 98 to 94 in a couple weeks. That was fine because it just relieved a bunch of pressure. But then it went from 94 or 102 and eight or nine days, that caused all kinds of problems. Really the speed of the move that's as important as anything. And on that point, is it that, as you kind of alluded to earlier, are there just margin calls starting to happen? You know, people are starting essentially globally? Essentially, that's what happens, right?

Starting point is 00:57:56 And when margin calls, the reason margin calls are happening is because money is being destroyed. Get a credit contraction. When money contracts, that means there's less supply. When money is loaned into existence, less supply means there's less likely that that loan or that credit extent is going to get service. So then it's going to collapse. So everybody starts scrambling for the collateral that actually exists, right? Not the loan, but the actual money behind it. And, you know, when people are scrambling for the collateral, they take the price they can get, not the price that they want.

Starting point is 00:58:28 And that's essentially a margin. And again, the speed of the move has a lot to do with that. I mean, this is using an example, like, where's oil? Oil is it 80 bucks a day, 81 bucks? You know, there's probably a lot of assets out there and a lot of loans that have been extended. that have either oil or oil reserves or productive land or machinery or companies that have oil as reserves. I mean, a big part of global monetary supply is backed by oil.

Starting point is 00:58:58 And right now, it's no problem. And if the foil falls to 75, it's probably not a big problem either. But if oil goes to 45 and then 35 and then negative, for God's sakes, like I did a year ago, because everybody's just scrambling to get dollars, that's not only deflationary. because of the jobs that are being destroyed in the oil industry, but all of the money that was loaned into existence as a result of high dollar or high oil price reserves, again, you just get this incredible credit contraction. I mean, I'll tell you, there's few things in the world that are more inflationary or deflationary

Starting point is 00:59:34 than the price of oil. And you get into a problem there too. If oil gets too high, then you started to get into these. Inflation becomes deflationary, right? And so deflation becomes inflationary. So you're in this band right now where it's okay, but you get much higher oil prices, you know, bad things are going to start going to happen. I was just talking with Kyle Bass, and he's of the opinion that oil is going a lot higher.

Starting point is 00:59:56 And he attributes it more to our lack of investment in hydrocarbon. So it sounds like you share that opinion. I've heard you talk about, you know, the large number of short orders on oil. And so that would suggest that the suppliers are not sharing the same opinion. But maybe speak to that. or where you stand on it today? I actually haven't looked to see where they're at in the last month or so. What I've said before is I think oil product producers should be making a lot of money here, right?

Starting point is 01:00:22 You know, they should be really happy. I don't think anybody is really happy other than maybe in the really short term. If, you know, oil goes to 120 or 130 and Nat gas goes to $10, you know, couldn't have probably be happy in the very short term. But in the long term, it's not good for anybody because it breaks. Again, it's kind of like the dollar. 95, 96, nobody really cares. put at 106, a really bad deal. On oil, I tend to agree with Kyle there's been low investment made

Starting point is 01:00:48 into it. And so it's kind of like the cure for low prices is low prices, right? Prices are low. Nobody invests then pretty soon. So you get supplies are low and then you get a demand shock and there's no supply. Boom, prices are higher, right? And that's kind of what we've seen here. So I tend to be sympathetic for files of view there, although I also believe that it's not going to be a straight line. It wouldn't shock me to see something like oil go to 60 and then 120. you know, something like that. Or it could go to 90 and then 50 and then back to one point. I don't think it's going to be just an easy, easy run.

Starting point is 01:01:19 I think there's going to be fluctuations in both directions. So kind of touching lastly on this idea that more money creation is inevitable, but they might need more crises, you know, in order to really move the ball further down the field. What's your take, you know, you just mentioned demand shock or supply shock, you know, the idea where I live right now in L.A. at our port, there's 80 shipping containers off of just sitting outside that can't even get to the port. I mean, is this kind of what you see kind of unfolding through 2022, this narrative of

Starting point is 01:01:51 supply shock? Well, so I think the supply shock, so I'm on record as saying a big reason for the rise of prices is not just the money printing. It's not just the pay lots. That's certainly a part of it. But a big part of it is that the government, I mean, government, they literally shut down the global economy. I still can't believe the speed and efficiency with which they just turned the whole world off.

Starting point is 01:02:17 And that just has really, really bad ramifications. I mean, when we had this just in time inventory, when I could order something in San Francisco and order for South Africa and it's there a day later or whatever it was, you know, two days later, that's pretty incredible, right? I mean, it speaks to just how efficient and how a well-timed machine the global supply chain was. But they broke it. They threw a bowling ball through the supply chains. And now as they rebuild it, they're kind of rebuilding two supply chains.

Starting point is 01:02:47 China supply chains and, you know, out of the U.S.-centric supply chains because we don't want to be dependent on them anymore. So that's going to take time to work. But I do think some of that stuff will get worked through. The fact that we had it as efficient as we had, it shows that we have the know-how to do it. It will take a while to do it. But I do think that some of the supply chain issues will get worked out. that will help with prices. I do think that we're kind of overdue for kind of a

Starting point is 01:03:13 pullback in, you know, equity run and prices. And, you know, I think inflation, while you certainly can't argue that it's here, I think, you know, if we got some kind of an economic slowdown as result of some of the inflation, then that pressure starts to reduce. And so that could help with some of the prices. So the long story short is I think that some things will get worked out probably in the next six months, but some stuff might take two or three years. I mean, ultimately, I think two or three years from now, commodity prices are much higher. I think food prices are much, much higher. I am invested in some commodities. I'm invested in some ags, but I've been waiting for a pullback before really going in on it any harder than I have. And I think we'll get it.

Starting point is 01:03:53 I think if you're patient, do eventually get the pullback. But I don't think that it sounds like I'm waffling here and I'm really not. Like I do think that some of the stuff is going to get worked out, but it's not going to get worked out overnight. Some of it's going to last a couple of years. I'm curious with that agriculture, bullishness, fertilizer comes to mind, which has just been exploding recently. How are the retail investor or how should they approach some opportunity like that? Is it through ETFs primarily?

Starting point is 01:04:20 Yeah, I mean, I think that's fine. You know, there's, you know, like, mosaic, something that we've owned for a long time. Pioneer seeds is something we've owned for a long time, you know, John Deere. You know, you can look up, you know, there's a number of ways to play it. I think there's an ETF called MOO that you can buy. Again, I think depending on your level of wealth and sophistication, you know, to a certain extent, I think you just want to keep it easy and keep it liquid to the extent you have a little bit your net worth and sophistication

Starting point is 01:04:50 and have the ability to hold through some drawdowns. Maybe there's some private opportunities, either, you know, real estate farmland funds or some kind of private direct investments. But I think agriculture is going to be a booming, booming, booming area over the next couple years. Brent, this was so much fun, man. I've been really looking forward to having you on and really appreciate your humility.

Starting point is 01:05:12 I really respect the way you've arrived at your opinions. If folks aren't familiar, you've talked about it on some other episodes. And you seem to embody the idea of strong opinions loosely held, maybe more so than anyone else I've spoken to. And that's what makes this so fun, just kind of continuing to kick this ball back and forth, as things continue to unfold like they have. Yeah, I'll just sign off by saying, listen,

Starting point is 01:05:32 And I've been wrong before and I'm going to be wrong a million times again. I can live with seeing this possibility and being wrong and having done something, but I can't live with seeing this possibility of doing nothing and suffering from it. So that's kind of why I've taken the position that I've taken. Yeah, and it makes sense why you're out here voicing these concerns so loudly because I think you're doing a great service. So anyway, Brent, really hope we can do it again sometime soon. Thanks for having it. All right, everybody.

Starting point is 01:05:58 That one was a lot of fun. I hope you enjoyed it. If you're loving the show, please don't forget to follow us on your favorite podcast app and even leave a review. If you don't mind, it really helps and we love to hear from you. You can always reach out to me directly as well on Twitter at Trey Lockerby. And I wanted to call out one feature on TIP that you might not be aware of, which is our list of ETFs for emerging markets. Just Google TIP finance. You'll find all the amazing resources we have for you there. And with that, we'll see you again next time. Thank you for listening to TIP. Make sure to subscribe to Millennial Ine

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We Study Billionaires - The Investor’s Podcast Network - TIP397: The Dollar Milkshake Theory Update w/ Brent Johnson

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