E131: 2024 Fantasy President picks, debt ceiling agreement, Dollar dominance & more

25:23All of a sudden, you're less capable of being president. That's absolutely not true. Oh, I didn't say it was. I'm describing what the Constitution says. Somebody who's not born here. We should call the Schwarzenegger amendment because when he was governor of California, there were people who wanted him to run for president. But look, it's too hard to change the Constitution. It's a very difficult process. us. So do I think that's going to happen? No. Would you be in favor of that? And under what circumstances do you think that it's about saying we should change that? He's emphatic. We should change it in fact.

25:53So what do you think? It's not a pressing issue for me. I'd rather have a balanced budget amendment. I'd rather that the president have a line item veto to control spending. If you want to blow up the government and cut it down to size and impose the ideals of liberalism, true liberalism, free speech, well controlled borders, but good immigration, et cetera, et cetera. I feel like there are lots of people who could do that. And the only difference is they were accidentally not born here, except they've created more value in America than most Americans that were born here. That's true. That would actually be far and born national, would be the most accurate term.

26:33Right. What are the most accurate term? Whatever dumb term you want to use. I'm just using the ones in the Constitution, the government I mean, he's a star each of them off for using accurate terms. I'll try to use less accurate terms in the future. So back to Jamie, Jamie Diamond. Nobody here is questioning whether he is a supremely competent executive. It's completely grant that he's done an amazing job taking JP Morgan. It was ready. The biggest. He's made it even bigger. How is that possible? Whether that's the good thing. In the face of them say we got to stop the bags from getting bigger.

27:05He's still going to be bigger. Yeah, whether that's a good thing for the country ultimately is a different question. No one questions his competence and his expertise. But again, I see no groundswell for him in either the Democratic Party or the Republican Party or even as an independent because again, it doesn't fit the populist mood of the country right now. But we got it. So that's your pragmatic path to victory. But let me ask you about confidence, then, because maybe I can frame the question and get a better answer out of you. That's what I thought I was answering when you said, who do you need more confidence?

27:34Well, you guys interpret my questions. Have you like you interpret it in terms of competence, sex interpret the question at pragmatic ability to getting into office. But let's ask, sex the question, and I'll ask you pragmatic, then I'll ask sex, the question of competence. In terms of competence, I gave you like four people. Is he the most competent person to run the country right now? No, you think DeSantis is more competent than him. I think that of all the major candidates who actually have a realistic shot, DeSantis is the most supremely competent as an executive. He's run the state of Florida.

28:05he did it during COVID, which was a major crisis. We all saw what happened. All of our friends were leaving California, because California had locked down. Schools were closed. We had the worst learning loss of any state. Small businesses were going under. Our toddlers had to wear these stupid, pointless cloth masks to school when they finally - We were including Jamie and Akru. Hold on, so, the Santa's kept Florida open. They had a great economy. It's number one in job creation investment. people moving there. He balanced the budget and that's why he was able to grow his majority from under one person when he first got elected to 20 points.

28:42So you believe he would be more qualified than Jamie Dynastie. Yeah, because he's actually been tested in a political realm. God, you see, you think that is the better test? I disagree. And I think probably the number one thing you have to do to be effective politically is to be able to understand when the media, the mainstream media and all their fake experts are wrong. Because that's why the country is such a mess. We keep listening to all these fake experts who are wrong about everything, including COVID. Did Trump do a good job as president in your mind? He listened to the fake experts. He had Fauci in there.

29:16So you don't think Trump did a good job as president? On COVID, he listened to Fauci too much. But okay, because Trump is an outsider and you seem to think he did a good job as president and a lot of Republicans do. So that's my point. He was an outsider. You love putting words in our mouth and characterizing it. I'm asking I believe in ways that I never quite said. Okay, I'm just asking you. I think that Trump did a number of good things in office. For example, he kept us out of foreign wars. Great. And I think the economy was pretty good until COVID. But he had no political. But I would say they were like two big Achilles heels.

29:47One was we had huge deficits and debt during Trump. And the other was once COVID happened, he listened to Fauci. And Fauci was driving the train during COVID. and hold on, gave us the lockdowns. And then Trump never fired Fauci, and on Trump's last day in office. He's in the metal. He gave him a f***** metal. Inseid. Inseid. And just so everybody remembers, June 16th, 2015, Ben Carson and businessman Donald Trump tied in fourth place with 5%. So things can change. And now Trump is swinging wildly at DeSantis, saying that DeSantis was worth than Cuomo on COVID, which is just laughable. litigate that that's the last thing I want to really get is COVID man we got bigger fish to find disantis I think it's been doing really well over the last week because Trump has been making all these wild attacks on him and it's gonna be a lot of bonding so now like they're they're really punching at each other it's really interesting let's pivot to the debt ceiling real quick here the house voted overwhelmingly to pass the debt ceiling agreement 314 to 117 so in the hands of the senate could be passed by the time you're listening to this some Republicans I think spending didn't go far enough, no shocker there.

30:58But Speaker McCarthy called it a first step. Projected the bill would reduce budget deficits by 1 .5 trillion over the next decade. Some highlights, non -defense spending, flat in 2024 at 704 billion. Only increases 1 % in 2025. And an absolute federal budget growth to 1 % for the next six years. for instance, 30 billion in unspent COVID relief money. That seems logical, fully funds medical care for veterans, that seems like a good idea. Reallocates 20 billion from the IRS over the next two years to put towards non -defense programs. That's that crazy idea to hire 80 ,000 or something, IRS agents.

31:43Pauces on student loan repayments will now end in August. We've talked about that on the show. Biden student loan forgiveness plan will be settled in the Supreme Court. Some stats on US debt, put up two charts here and then I'll get free birch's position because he's very passionate about this. US annual surplus for deficits through end of year 2022. See those great years. I think those are the Democratic .com Clinton years. You did ran it up. Well done, Clinton. US national debt, end of year 2022. My lord. 32 getting close to 32 trillion US annual federal spending up and around Well breaking six trillion a year and tax revenue by deficit here.

32:30We have it go to that the red chart This is our national debt. This is a upside down hockey stick So this is what's concerning about it is we're going exponential on this thing The problem with this just to reframe it once again for the hundred thousand time wait a second Wait, this red chart isn't this freeberg's losses in Vegas this weekend? I think that's for the part. Oh, no, that's our collective losses in Vegas. Is we got to I think we did the math. This group was accounted for 10 bits, 10 bits of Vegas's blackjack revenue for the year. So good job, everyone. Good job. People everybody in Vegas is now completed their Q three quarter targets early.

33:10So the problem obviously with mounting debt is the interest payments on the debt cause you to take out more debt and that there's a tipping point where it becomes insurmountable. And there are many people sounding the alarm that we may be entering that point that in order to fund the interest obligations on the debt, we need to take out more debt and then there's more interest payments and therefore there's more debt and it just keeps getting bigger and bigger. And so this chart I'm sharing here is actually from the federal government's GAO, the government accountability which acts almost like an independent accounting and forecasting body, trying to provide some outlook on the fiscal condition of the federal government.

33:51And this is an analysis I think they put out a few weeks ago, showing that as of the fiscal year 22, 8 % of the overall federal budget was going towards interest spending. By fiscal year 25, it'll be 26 % and then net interest spending will need to grow to half of the budget. But if you go to the other chart, why don't you say that? Why don't you say the years? Because it's important to note what years they're talking about. 2021, 2096 is what they're showing. This is a long window. Yeah. I get it. But let me show you this chart. Just pull out the first chart. So this is our federal government's interest payments per year.

34:28And so this is how much the government pays on interest for the debt. By the way, most of the debt is getting refinanced now at the higher interest rates because a lot of this debt was sitting in Zerr era since 2008. But as the debt has to get refinanced and more debt is taken on to fund the interest payment obligations, the interest payment actually starts to mount more significantly and that's what we've seen in the last two fiscal years in particular. Now when you take this chart and you overlay how much we spend on defense, so here's a defense spending. We are, I think as of this month or last month, now spending more, the federal government is spending more on interest payments on the federal debt than they are on national defense.

35:12Whether we believe we are spending money on national defense in a smart way or in an accountable way or whether these are good strategic priorities and good strategic decisions, the fact remains that at some point here our ability to actually fund the programs that we want to fund, whether their social security, Medicare or defense, the major cost outlays for the federal government, It's going to get further hindered and continually more hindered by the fact that these interest payments are climbing so significantly. And if you go to the third chart, I think it kind of provides the final point, which is social security.

35:44And we're very quickly seeing interest payments mount to the point of where social security spending lays. And when that happens, obviously, as you guys know, everyone talks about that as being the golden program, the right and the left, the Democrats and the Republicans simply will not touch social security from a policy perspective, from a getting elected perspective, but the economic and arithmetic reality is running up against them, which is that the interest payments on the debt are starting to threaten our ability to fund social security and Medicare. There's many more charts we could pull up to highlight this.

36:18The Republicans in announcing the debt deal this week made a lot of proclamations about it being a win and showed how we were able to reduce spending by $2 trillion. I think the statement they made, the deal cuts $2 .1 trillion in spending over the six -year life of the bill and $1 .5 trillion in such a trolley mandate savings over the next two years. $2 .1 trillion over six years, remember we're talking about a $7 trillion per year budget. So that's $42 trillion over those six years. We're cutting $2 trillion of 42. So it's a 5 % impact. to start, it's a start, but what leverage do they have now?

36:58And I think that it's not that much to win. I'm not that much to win. But the census freeberg, but they actually did decide to make cuts. And that feels to me, and we did predict here that they would get this done, does feel to me like this is some amount of progress, right? I mean, do you feel good about it or indifferent, freeberg? I think you guys know, I think that there's, we have to tackle the structural problem of revenue spending interest rates, those are like very big numbers that are challenging each other, chipping away at the spending doesn't quite get us there. And it doesn't seem like there's a clear path here.

37:38Even the argument that RFK made when he came on our show, RFK Jr. made when he came on our show, that cutting military spending would have an impact. I mean, you guys see military spending is already starting to get overtaken by the interest payment spending. So does that really move the needle? I think it's going to be an economic reality that all programs are getting need to be cut back in order to fund the debt obligations or We're going to see massive inflation But you feel I guess my question was you feel like this was a good step or a good signal that maybe the government is and our representatives are getting the message that they need to make some cuts at some point.

38:17I don't think that there's any way to provide the necessary fiscal security for the federal government without bipartisan unitary support around the objective, which is to get to a balanced budget and to reduce the overall debt and interest payment obligations. And if you can't start from that point, it's this push and pull over what programs get cut, but I want more money being spent. I want to have a pipeline. I want to add this. So you're not super enthused by this. I thought it was a positive step. Jamal, you have talked about refinancing the debt, putting the $100 ,000 ,000 coin or whatever.

38:52We wind up doing refinancing this on a long arc, 50 year, 100 year arc. What does this debt ceiling reconciliation or whatever we're going to call it? But they came to some sort of agreement here signal to you. You predicted they would get through this pretty easily. Yeah. Boring. Nothing burger. Nothing burger. Move on. Okay. Satya, would you buy 100 -year bond from the federal government? If I was a foreign government, yes. What interest would you need to get paid on that to take that on? Probably one to two percent. One to two percent for 100 years? Yeah. So it would be downside protection.

39:31You just feel like this is a secure place to put some Mounted money. This is how any any country with a turbulent currency Would make this decision and you could actually get close to zero I think that when we had Zurb you probably could have charged a negative interest rate Because you would have effectively been charging countries third -world developing countries even first world countries I just wanted a protective mechanism against their currency volatility They would have probably paid you. Just like today, you can get B .O .J. debt. That's negative yielding. So it's no longer negative, but it's still probably in the realm of one and a half percent.

40:10It's nothing. If you just do the math, it's nothing. And there's a way to understand why everybody just gets their underwear in a bunch here. Okay. Non -gender underpants. Put the red chart up there. It's nothing. It's nothing. It's nothing. It's nothing. It's nothing. It's nothing. It's a hockey stick, nothing. I think you guys will see here is an accelerating problem. Yeah, cut revenue. The debt is getting bigger and bigger at the same time that foreign governments and investors in general don't want to fund our debt. So therefore interest rates will rise. Our interest cost will keep going up.

40:44That's not why interest rates are going up. Well, if they're going up because the Fed is raising rates because of inflation, but at the same time that's happening, foreign governments are not as interested in having dollar reserves and US treasuries. said who? Does demonstrated by what? You look at the foreign reserves of these countries of these sovereigns. They are much less interested in holding US treasuries. Foreign reserves are China. Starting with China and all the BRICS countries. Foreign reserves are up. These guys are banking US dollars like nobody's business. I don't think so. I think it's been going down since 2008.

41:16I'll find you a chart. Yeah. Maybe from 2008, I don't know, from the great financial crisis at the absolute but what I'm saying is that in general, the anchor currency for governments and central banks has been, will likely be in the future, the United States dollar. And we get back to the circular argument, which is, I don't think it's possible for politicians to cut expenses. So I am just an advocate for cutting revenue because I do think it's the simplest way to force people. Because the next time they go through these machinations and all this theater around a dead ceiling, they'll just have less revenue to play with and it'll just become a harder and harder and harder problem.

41:57Meanwhile, I do think that you have to take the ball where it lies and take these $24 or $30 trillion and refinance it well out into the future and make a bet on US exceptionalism in US GDP. And if you don't want to believe it, don't fucking be here. Move to some other country where you think it's so much better and go do it there. But, you know, what if the market's not there? What if the buyers are not there on your own? Sure. I mean, you know what? An asteroid could hit the Earth in the next day. We could talk about all kinds of long -tail consequences, but there is... You have to be able to probably wait these things and then spend your time thinking about the things that are more probabilistic and be able to compartmentalize the anxiety of the less probabilistic things.

42:38So I think that could there be a scenario where there is no interest? Sure. is there one no because you see every day the governments in the market doing auctions and there is a robust demand for United States government debt. And until there isn't this argument is spacious and all I would tell you is just keep trying, put out more, try a 45 -year -old bond and see how it feels like. Try a 50 -year. You don't have to do 100 if it makes you too anxious. That's fine. Let me just ask you at some point if the market isn't there. The buyers are not there. But let's just go through the analysis because I know that you think it's a zero chance, but if it says low probability, do you agree that the severity is high, that the significance of that being the case?

43:20I don't, again, I am not going to give an Iota a breath to a long tail five sigma outcome. It is a waste of time. Okay. Because it occupies, I don't tell you why I don't do it. It occupies my mind share, which takes away from me figuring out how to make money and win on the field today. So I have, you know, I wake in a 24 hour day, okay, just to give you a sense of it, I sleep for eight, you know, I'm eating for another one or two, all this bullshit, I have four or five hours a day of useful thinking time. And I try to think of the belly of the probable. And I try to compartmentalize these dumb long tail sigma events because it distracts me for making money and winning.

44:05I actually try to think about long -tailed sigma events that could make me money. This isn't one of them. So I just don't spend time thinking about it. And I could be totally wrong. I could be totally wrong. But it's worked for me so far and I'm gonna stick to what works. Guys, Ax has been on Google for five minutes. He's got something for you to mark. Go ahead. You stick to the investing strategy that works for you. I'd like to talk about the status of US treasuries. So if you look here, this is total foreign treasury holdings as percent of marketable treasury securities. So it's gone down from the mid -50s to the low 30s since 2008 -2009.

44:42As a percentage. So foreign governments, foreign governments don't want our treasuries as much as they used to starting with China. They are diversifying into other their currencies and gold. And there are a bunch of good reasons for that. By the way, this comes from a blog, which is really interesting. It's a crypto guy named Arthur Hayes. And this is actually a pretty interesting piece called Exit Liquidity. Hayes writes interesting pieces on the banking system and D dollarization. He's got a little bit of a doomer thesis with respect to the US dollar. You know, obviously he's pro Bitcoin. His views are sort of similar to topologies.

45:17But, hey, man, I think one of the points he makes that's really interesting is that, But if you're to zoom out 30 ,000 feet and think about the regime that we had during let's call it the unipolar moment where China and the United States were strong trading partners and we had this close relationship with them. The way the global economy worked is that China would sell goods to the United States. They would have huge trade surpluses and then they would take those dollars and then use some of them to buy raw materials like energy that was called the petrodollar. And then they would take other dollars, their surplus.

45:54And instead of repatriating at home, they would have to then convert that money into RMB and brought it home. They didn't do that. That actually would have increased the value of their currency thereby making their export less attractive. This is why they are accused of currency manipulation. They took their surplus dollars and bought US assets, mainly US treasuries. So we had this trading relationship with China. I think everyone understands the physical world side of that trading relationship where you had US manufacturing jobs got Export to China they basically made everything a lot of cheap goods came into the US they had a trade surplus What I think people don't understand is that a huge part of that trade surplus was used to finance US deficits and debt And so you had this like cozy relationship between US elites US politicians and China where they got to rack up these huge deficits the government got to spend a lot of money and China would fund it very cheaply, but now that's all ended.

46:49That's stopped because we're basically starting to decouple from China. So China doesn't want to do its business in dollars if they don't have to. Obviously for the products they sell in the US, they'll take dollars. But they're already trying to do as many transactions as they can, buying oil, for example, or energy in R &B. I don't want to dispute this chart because this chart is true, but it's a small part of how the entire puzzle works. And so this is a Bitcoin maximalist who cherry picks a few data points to try to make a point. But if you look at the IMF data and I put it to you in the group chat, you can't just look at US Treasury securities.

47:25You have to look at actual absolute dollar reserves. And when you look at that over time, it hasn't fluctuated that much. And so for all the dopes that don't understand how this shit works, it's not just securities. It's actually also money. And the the actual amount of US dollar money hasn't changed that much. It's gone between 60 and 70%. It's just 99 in the chart. I just find this argument, again, one of these long sigma arguments that are anxiety riddled and I just don't want to waste my time thinking about it because it will distract me from winning on the field today. You got to be able to block things out if you want to be a capital I would get her I agree.

47:59But an interesting discussion nonetheless. I don't think these things are just noise. I think you're seeing a trend. I mean, look how many headlines there are about the BRICS countries getting together and starting to transact in currencies other than dollars. Yeah, you know what? Those are very cherry -picked as well. And you said before you don't trust the press. So you trust the press on these headlines all of a sudden. I don't think that that's actually... I don't think anyone's disputing the fact that China and Saudi Arabia and China and Brazil are doing energy transactions in R &B. I think it's very tiny.

48:29They are doing all putting all their money to venture capital in the West, private equity and the rest. real estate in the West, the Middle East. That's where they're focusing your energy. There's a different issue. Look, no one is disputing the fact that China and the BRICS countries more generally are trying to create a trading block that is not dependent on the US dollar. And they're gradually the same. They're rattling. It's like, I think they're trying to just let the US know, like, hey, we have other options here, and I think it's China just trying to, it's China on their heels, trying to make deals with other.

49:03So China pursuing their self -interest, which is not to be dependent on a dollar that's been weaponized and controlled by the US politically. You can be sure that's out of UAE and the entire voting block in the Middle East are shipping their money west, not east. I think you have a very accurate assessment of what China wants, but it doesn't mean it's going to happen. And I think you have to make a bet. Do you think it's going to happen or not? I bet it's not going to happen. And I feel recent, and I've said this before, is China is in a demographic time bomb, and that will dominate everything else.

49:32That is a country that is imploding. And there's anti -capitalists. They're anti -capitalism. No, no, no, no. I'm gonna say that they are a capitalist. I don't know how I'm gonna make these judgments, but I'm gonna tell you practically speaking is they are demographically imploding. They do not have enough people. The country will be halved by the death rate and the lack of birth rate by 2300. Okay, so in another 70 odd years, that is a problem that is going away. And that is just mathematical. And if you just again, you just have to take a deep breath, look at the data and just extrapolate and you see, this is not a problem.

50:06China is not a problem. China has real problems. There's no question about it. They've got demographic problems. They've got problems in the banking system. They've got a real estate bubble. Stardom problems. There are questions about whether the leadership now is turning away from the capitalism that got them to this point. They are. So there's no question that China has problems. but you want to talk about trends. There is a major trend in the world right now where, again, the BRICS countries, Brazil, Russia, India, China, South Africa, and you can put Saudi Arabia in that bucket and a lot of other countries, they are looking to diversify off of the dollar.

50:42I'm not saying that the dollar is going to stop being the world's reserve currency because I agree with you that there's no ready replacement at hand, but they are trying to do as many trends actions as they can off of the dollar. And they do not want to hold treasuries like they did 10 or 15 years ago. I don't see data that can turn. They're trying to do it. Yeah, I don't, transactions off the dollar. That's a very loaded statement. I don't think that's true. I don't know if that statement's true. What are you talking about? This was like major. No, they tried to do one trade. China and Saudi and China and.

51:11No, Saudi and China talked about it and they didn't do it. They talked about it. Yeah, I would like to see data on that, not just a couple of headlines. Because I think everybody wants to. Nobody just wrote like that. What are you talking about? It was the data, the Brazil thing happened, but I think it was a small trade, David. Yeah. Yeah, that's exactly what your first or say it didn't happen and now you're saying that it was small. No, I'm saying the Saudi Arabia China thing did not happen. Your statement was they're trying to to lock many transactions as possible off the dollar. I don't think they're trying to do as many transactions off the dollar.

51:39I don't have never seen any actual data point. You don't know. Support that. You're just making shit up. No, you're forcing one to get off the dollar. Of course they want to get off the dollar if they can. No, no, I think Jason's saying you're right. what they want to do, but what they are doing. China is what he's debating. They're totally. They're sending their money west. I don't think they're trying to send it east. I don't think that's gonna be. Hold on a second, you're right that Saudi Arabia is investing in the U .S. They're, I'd say, highly diversified. That's a little different than what China is doing.

52:10Yes, we're in agreement. China wants to get people off the U .S. dollar. China's in decline. China's got big issues. We all agree on that. The Middle East has a lot of cash. I think if they're going to decide what to do with it, they'll appease China to have a solid relationship to ship oil there But I think Now, China's in the West that's where they're gonna get a giant little realignment. How much you noticed? I think the realignment is Chinese just Negotiated becoming Westernized and being accepted in the West and moving towards an investor in the West in technology That's actually the trend the Chinese just negotiated or approach mall between Saudi Arabia and Iran Did you notice that?

52:49That's the last one I just read. I'm just talking about where they're putting their chips. Where are they putting their chips? I think what you've explained, and I think we're in agreement, they'll sell their oil to China. Then what do they do with the bag? They take that same bag, and they want to put it towards the rest. No, it's even worse. Again, the thing is, even if you settle a trade in the Yuan, I think you guys keep forgetting this keeping, which is the Yuan is pegged to the US dollar, so it is a proxy dollar. So if you really want to decouple, you first have to let this currency free float.

53:19They have no desire to let them do that, especially in a moment where they're economically imploding internally. So again, you go back to the circular argument where everything goes back to the dollar. So yes, they're saber rattling, sacks, I acknowledge what you're saying. I think you're totally right that they would love a free floating currency. The Chinese would love Chinese and they want that free floating currency to not be pegged to the dollar. But right now they have kept it pegged to the dollar. So he just do that and it says not. It says, it's as big as, it's as big as, is you on peg to USD and it says, the Chinese you on is not peg to the US dollar.

53:51It was peg from 94 to 2005, but in 2005 China made its currency of floating exchange currency. It is not a floating currency. Yeah, and then do you trust the, you know, who's, well I thought it's highly manipulated, I agree with that, but I don't think it's pegged. It's not a floating currency. It is not a free floating currency. China controls the exchange rate between themselves and the US dollar. Let's move on. I think we've covered this. It'd be actually one thing that might be interesting. You're just in trial. Reality. You have no basis for declaring that things like the moves that China is making with Brazil and Saudi Arabia, you're just declaring that to be fake news.

54:26Nobody's saying fake news. We're saying it's happening, but it's probably minor. And it's probably more described as a problem. What's your basis for believing that? Because we have no evidence to prove that it's occurring. We just have a couple of headlines and some small... But I mean, where is it? I mean, all we're seeing is the the the money in Saudi Arabia is they're selling oil to China correct They're doing deals there and then they're taking that money and then they want to invest it in the West Who are you talking about the other thing to keep in mind is that the Saudi real is pegged as well to the US dollar And that's been there since I think the mid 80s so China is a very opaque manipulated currency market where they keep the dollar you want spread quite fixed.

55:07On the other side, Saudi has kept the same peg 3 .75 to the dollar since the mid 80s. So again, it all just goes back to the US dollar. It's all proxies for the dollar. So there's some symbolic value, I suppose, in trading in you on. But everything goes back to the dollar because that's what it's measured in. So it's not symbolic. What's happening is deeply geopolitical. You've got a couple of One thing's going on. One is that the US has now instituted sanctions on over 40 countries. Moreover, the whole world saw that in the case of Russia, we froze their foreign reserves and basically seized the property of their oligarch.

55:43So if you're an oligarch in the Middle East, do you think you want to keep all of your money on all of your reserves in dollars? You understand that the dollar has been weaponized in its applicable instrument in the United States. That's just a fact. So you're going to look to diversify. You're going to look to put your money in gold. You're going to look to put your money in other currencies. Is there, like I said, a currency at hand that's ready to be a replacement for the US dollar no. And it can't be the Yuan. They don't have an open capital account. Who would you be? Where would you diversify?

56:09If you were the CIO, where would you diversify? Well, what I would do if I were the secretary of the Treasury of China is I would say that okay, for the exports of the US, we're going to keep getting dollars and we'll do something with those dollars. but for everybody else, we're going to try and do as many transactions as an R and B as possible. But what about the sellers of oil to China? What would they do? They get a RMB. So you would tell them exactly the trades that we're talking about. You tell them to hold RMB over US and Euro. China is seeking to pay Saudi Arabia under sale. If you don't understand it, I do understand it.

56:44Let me explain it. I will understand it. But I'm asking you is. Let me ask you a question. Would you You at CIO of Saudi or UAE, would you want to keep R &B? Would you want to keep Euros or US dollars? Where would you want to keep your money? And the question is, if they sell that, would they want to keep it in R &B? I don't think they want to keep the one. Honestly, to answer your question, I want to put it in gold. That's right. I put it in gold. I wouldn't. I put it in gold. Okay. Here is what China is proposing. Okay. They're saying to Saudi Arabia and Brazil, we're going to pay you for your oil in R &B.

57:16And then you are going to take that R &B and you can buy our products because again we make everything where the factory of the world and if you still have a surplus after that you can settle that surplus in gold because Beijing has a very liquid you know gold exchange market. They're giving them that. That's what they're proposing. Here's your gift cards. Spending our cards. Two data points on the socks that I just read. It's in this barons article that I included Nick you may just want to link to it in the show notes which I thought was pretty good. Swift, which is sort of like the international payments backbone, the share of yuan transactions briefly rose above 3 % in 2022.

57:56That was the peak and it's now off 26 % down to about 2 .2%. So actually, the share of yuan transactions has actually been shrinking in the last year. And then the second is that what this article states, which is interesting is that all the belt and road loans that China gave into all these developing countries in Africa, the Africans we're like, we don't want this you want. And so they just dollar swapped. And so now the BRI loans are all serviced in US dollars as well. So all the trillions of dollars China spent. I'm just saying that again, I'm not judging. They're all an alternative Swift.

58:25I mean, again, we weaponized Swift as well. So yeah, but Swift is still 98 % of the world of how it works. All I'm saying is I just like to keep things simple. I think the US dollars here for a while, I think that debt suck. I would love to have no deficits. But I also think these numbers are roughly like we're playing plus or minus on the margin two to three hundred basis points We talked about that last week and so I want to keep my brain open to the simple obvious things like You know selling That's what it's come to is CPG for you. Tremoff. You're like it's a down -to -down Big CPG guy now.

59:00Yeah, that's where Tremoff's focused. Why don't you pull freeberg into this debate? I want more I'm just talking to reality or at least I try to be. I don't know. There was a deal, China had a big visit with Brazil in March. We talked about it briefly. I shared a couple of these articles that covered the transactions. They signed $10 billion of trade agreements and cooperative agreements, all of which were meant to settle in Yuan. Brazil has made the statement that they're going to start to settle in local currency. They're doing this multilateral trade program globally with partners where they're going to trade and transact in local currencies.

59:41They're not set to the dollar. They're not fixed to the dollar. And I think that's just part of a general movement. I don't think it's about, hey, we got to get off the dollar as soon as possible. But I think it's about we could diversify. And there are other stable economies around the world. They might be having demographic issues or various economic issues. But gosh, man, don't we all. Europe, China, the US, everyone's got debt problems, demographic problems, over leverage problems, growth problems. And fundamentally, I don't think that there's as safe a haven as there has been historically.

1:00:10And as a result, I mean, a lot of these governments and a lot of the business leaders in these countries are very much open to doing transactions in multiple currencies. And that's the beginning of the end. It's the beginning of a set of transactions that isn't about, hey, we're all getting against the dollar. It's over, let's crush the dollar. It's like, we're just gonna do trades in other currencies. No big deal. But the beginning of the end, Dr. Do, all right. Shout out to you. It's the end of the dominance, right? It's the end of you talking about the end of the dominance and China imploded during that same time period So I forgive me.

1:00:43I still believe in American exceptional From American exceptionalism wins. There's another article from Bloomberg Rick. This is from April 24th all of a sudden this guy loves the mainstream rich draws membership been from 19th For some listen Jake out. I'm fine if you want to say this is fake news go for it Are you saying? Believe it's fake news No, no, no, I need information about the world when they write an article about me that's completely made up. I'm going to call it fake news. Why are you treating like every press article is like the same? That makes no sense. By the way, it does make sense for the bricks to expand, right, Saks?

1:01:18Because it's like, if NATO was purely an economic organization, that's probably what bricks evolves into over time. And it makes a ton of sense for them to do it. They're creating a competing China setting up an alternative to the IMF. They've got this alternative to the IMF that they're setting up that's not dollar denominated. And they've got seven nations in this thing now. It's, you know, and by the way, Jason, when I say the beginning of the end, I don't mean the end of the world or the end of the US, the US will continue to be the innovation hub of the world. The US will continue to have freedom and civil rights that know that no other country can parallel.

1:01:49The US is an incredible place to live better than anywhere else on earth. But the economic status of the US, given how we have spent money and how we continue to operate our federal government with this extraordinary deficit and debt spiral problem means that other people have to be protective of their currencies and their assets in a way that's thoughtful. It doesn't necessarily mean it's all over and everything, but the dominance you say at the beginning, it says had economically. You can already see this in all the trade barriers and tariffs that are going up, the decoupling that's going on.

1:02:18Look, the United States set up a system of global free trade basically in 1945. And we had a bipolar world with, we had the Soviets and America, but the Soviets basically opted out because they were communist. They had their own system, but it wasn't compelling for the world economy. Then we had the unipolar world. So basically for over half a century, we had this completely open system where there were no trade blocks in the world. Now we are seeing the rise of trade blocks with multi -pollarity. Yes. The US is pursuing a contradictory policy because on the one hand, hold on, here's the contradiction.

1:02:57On the one hand, we run these massive deficits in debt, so we are a debtor nation who needs to make its debt attractive to debt holders or our interest rate is going to keep going up. Okay, so that's on the one hand. On the other hand, we are doing things like weaponizing the dollar and weaponizing swift and imposing sanctions and engaging in geopolitical fights that are highly antagonistic to the nations that are would be holders of our debt. So one of those two things has got to give. Either we reduce our debt and our deficits and then need, Remember, this is not a stable situation. We continue to issue, what is it?

1:03:45Somewhere between one and two trillion a year of new government debt. So we have to constantly find more and more money out in the world to support our debt. At the same time that we're weaponizing the dollar and the financial system, so that these sources of global capital don't want to participate. And I agree with SACS. This is why I think the disappointment to me is that there isn't bipartisan recognition of this being as severe as a war. It is the sort of thing that the government that both parties need to get behind and say, let's figure out a path to solving this problem. This is the objective.

1:04:18We've got to get our fiscal affairs in order. And then all the other stuff, the social stuff, the policy stuff, we can fight about, we can argue about later, but we have to put some gas in the tank. We have to be able to drive where we want to go. And we can't drive right now. Here's what I'll say to you, freed bird. Since you said the beginning of the end, Now, maybe it's a poor choice of words. It's not the end. You said, hold on. Let me just get rise. Don't miss. You just had to get the end by the end. But don't miss. Carry on to what end of the end of the end of the end of the dollar dominance and global trade.

1:04:48Okay. I disagree with you. I think dollar dominance will continue for some time. Jake, are you disputing that the world is becoming more multipolar? Do you think we're still living in unipolarity? No. And nor do we need to live in unipolarity for America to still be the champions. We still are winning how to pace that nobody else is Space energy cars AI We're probably gonna win chips and we're gonna probably win Material science and batteries and we're obviously gonna win biota We're winning in every one of these categories. We're the clear winner the only thing We're not the clear winner in his factories and mass producing Shlokki stuff that's all in the Amazon China is completely imploded and the Middle East is taking their last 20 or 30 years of capital and they're investing it in the West in space energy cars, AI, chips, basic materials, batteries, all the stuff that's happening here on our shores.

1:05:40We are in the most winning position. We've probably ever been in as a country. We took a bad beat. We spent too much money. We got a dysfunctional government. We got culture wars. We got a lot of bad stuff distracting us. But the truth is when you look at breast hacks, when you look at innovation, we're winning on almost every dimension. We're just a little caught up in the fog of culture wars and you know thinking that we're going to be dominant and perfect in terms of our budget. We do have to fix our budget. We all agree on that. But we are winning and China is currently stalled out and it's because of freedom.

1:06:13It's because we support our commerce because of the basic human freedoms we have. You two guys are Dr. Doom. This is so stupid. I'm hoppin' off. I'm done with this just strike my shit out of this episode I'm trying whatever you want is there anything else you want to talk about today because I'm done I love want to talk about Nvidia, but I don't know if you guys I'm sick of being characterized as dr. Doom J. Cal It's fucking stupid We want to have a real conversation about like real Instead of you But what I said I'm not fucking extreme. I'm not I'm trying to have like an actual discipline conversation about where things are going It's not black and white.

1:06:50It's not about oh my god, the US is gonna win. Everyone else is gonna lose. It's not a win -lose situation. We cannot afford to continue to spend the way we're spending with our federal government. That's it. I agree with that. We have to I think we're still winning on a different dimension. So why are we winning? That's not the conversation. Why is the federal government is different from US Innovation. There's a difference the federal government These are the voters were voters elect to tax and spend and voters elect people to create a system that can legally go in and take assets and spend assets and borrow money and we've done it in an extent now that is becoming almost a runaway train.

1:07:23It is a problem. We saw the negative red chart that sacks had you pull up several times that has nothing to do with US dominance and fucking electronics and chips and biotech and all this other sort of stuff. We have a problem with how we spend money at the federal level. I agree with them. I agree with that. That's the conversation. I believe that the dominance that we have in entrepreneurship and every one of these categories is what will pull us out of this. The free enterprise system is a wonderful system that produces a lot of good prosperity for America. Okay, that's great. I agree with that.

1:07:55And it remains to be seen if China can sustain its remarkable economic growth that's had over the last few decades. So that remains to be seen. However, the United States is behaving like a late -stage empire. And that is separate from the system that got us here. We have unsustainable fiscal deficits. We spend way too much money that we don't have. We have an uncontrolled southern border. Our cities are in decline. We've got hundreds of thousands of people living on the streets. Have you seen it? We look like a third world country. It's three or four countries. Three or four cities that's... We are meddling in countries all over the world engaging in wars or proxy wars.

1:08:36We are behaving like a late -stage empire. So, Jake Cal, it's true that the United States has a wonderful system and that's what got us here. To, it got us to unipolarity where we were the world's only superpower. But now we're in a world in which other countries are rising to. It's more multipolar. Agreed. And whether we continue our dominance will depend on whether we make the right decisions right now. And right now we are not making the right decisions. Adding two trillion to the debt in peacetime a year makes no sense. Yeah, you're a little ran. It's like Wiley Coyote going off the cliff and pretending like if you just doesn't look down There's nothing to worry about.

1:09:15I have said from the beginning we need to get spending on the control But I am also incredibly enthusiastic about how we're performing in innovation and capitalism right now It is off the charts how well this country is doing on those dimensions. Tremont you have any thoughts while we wrap up the thing No, I think we ended up conflating a bunch of issues into one And I'll just say what I've said before, which is that the United States is kind of the simplest safest bet and that these decisions are made on a relative basis.

1:09:46China, unfortunately for them, has a huge demographic problem that will diminish them economically. And you're already starting to see it, but it's going to get really exacerbated in the next 10 or 15 years. That's just the mathematical reality for a country that has literally zero immigration and no solution. Europe is not in a very great situation and the only place that's really firing in all cylinders is India, but it has a long way to go to build the infrastructure that can really scale and make it as predictable as the United States. Could it do it? I think so, but it's going to take a long time, but 50, 60, a hundred years of investment.

1:10:24So I don't know, I just kind of like try to simplify for myself. I think the US will be fine. I think the dollar will be fine. I don't think it's right to spend this much, but I think that politicians are incapable of cutting expenses, and so I would like to cut their revenues. That's it.

1:10:43That's a great discussion, free bird. I don't think you are. Respect cutting. I don't think you understand what the audience actually wants to hear. This is actually the core of the debate that we just had. Well, just do what free bird asked you, which is just to play his clip in his words. And then I'll have it right here. I think that the Saudi China trade, if this happens, and oil is sold in one, is the beginning of I think the end of the assumption that the US dollar is a global reserve. That's all. Yeah. That's what you said. That was your prediction. That you said in the beginning of the end.

1:11:14You said it twice. If you don't believe it's the beginning of the end, it's fine. Of the US dollar as a global reserve. Yes. If you believe that the US dollar will not be the global reserve, you said it twice. Yeah. And I disagree. I think it will be, well, we remain the global reserve for all lifetime. That's all. It's a fundamental difference. Let's move on. Yes. I'm ready to send to bring up the culture wars, but these have become prominent. So maybe we could have a meta discussion about these. There are three things going on. One, we touched on the book banning. I'm using air quotes there.

1:11:48And there's been a lot of feedback that's come in since then. just to follow up briefly on it. Books are not exactly being banned. It's a much more granular and nuanced issue. There was a bill 1467 that happened that Ron DeSantis did sign. This said that parents reasonably should get to see what's being put into classrooms. And as you might suspect, this is being done on a very local level. When you put all that control at the local level, you will have different constituents, band books that maybe shouldn't be. Some of them are obvious ones that were too graphic. I think most parents would agree shouldn't be in a school library.

1:12:32Other ones were horror books or young adult books. You can look at all this stuff, just search for pen and books report, pen America. And if you there are instances of books that shouldn't be banned, being banned an instance of books that we'd all agree on, but it is not exactly bookbanging. It's letting each of the school districts make their own decisions and they're not going to make perfect decisions when you put them out in the edges. So just to make that super clear. I think you're right to focus on the terminology here because this is a question of what is put in the school library. That's it.

1:13:09So that's not a ban. Right. A ban would be if you couldn't purchase the book for yourself, for your kids, any parent can buy any book they won Florida. We do have an issue, I think, with the curriculum where really important classic books are being removed from the curriculum for political reasons, mainly in California. Books like Tekela Mockingbird or Huck Finn. That was weird. They're being removed because they're being accused of being racist, even though the whole point of those books is to, I think, call it out. Call it out and teach kids about racism. So there's a lot of stupid things happening from the left in terms of removing books from the curriculum, which I think is a much bigger deal than removing books from a school library.

1:13:52There's also things happening with like, you know, Ian Fleming's James Bond books being rewritten, like posthumously because... Two sexes. ...and me accuses sexism. Bond girls. Or raw dolls books are being posthumously edited. So like books are literally being rewritten in a way that their authors never intended. That is positively or well -earned. That really is. That's really wrong. That's really wrong. That's really wrong. Now on this on this DeSantis thing, I mean look, this is this is going to the level now of being a hoax. One of the stories going around is that there was this book of poetry.

1:14:28This totally innocuous book of poetry that was being banned in Florida. And I want to put it out there. It's a great Poland. Yeah. Yeah. So I wanted to find out the truth of it. Well, as it turns out, like you said, J. Cal, this is a Miami -Dade school district. A decision was made, this is not by DeSantis, this is made at the level of individual schools, okay? Which are voted on and their parents on these school boards, so it's going to just follow the demographics and whatever that local community is. Right, so basically what happened is this book of poetry was literally moved from the elementary school library to the middle school library.

1:15:00That's what happened. But all of a sudden, and this was spun on social media and by the mainstream media as if the Santa's had banned this book of poetry. To the point where Miami -Dade school district had to put out a tweet correcting this. So I never banned or removed it. It's just moved from one library to another from the Ellen. Well, I think this is a super interesting point, David, where you and I are in agreement. You and I are both for freedom of speech and for big advocates of that. And then there are decisions, and you could reasonably make this decision, Hey, let the parents decide.

1:15:32Great. When you let the parents decide, you have to take into account that these school boards could be hijacked by different groups of people, or they could be very small, monocultures of little towns or cities. Here's the list, by the way, if anybody wants to look at this, you could actually look at the very granular list. Penamerica keeps an index of all these. I put the thing in the chat here, and you'll see things in left, right? Everybody in between some places are banning all the LGBTQ books. some are banning the critical race books or books by people of color. Other ones are banning, you know, the James Bond novels, et cetera.

1:16:06So it's a free for all of parents executing their rights at a very local level. And, you know, I guess if you want parents to have a say in their schools, it's going to be slightly imperfect and variable. But it's not like censorship going up. There is censorship going on. I guess in some ways, the political question is, do you allow government bureaucrats to dictate to parents what their kids are going to see or have access to. And I don't think that's viable. I mean, look, parents could take their kids out of the school and homeschool them if they wanted. Yes. So at the end of the day. So they have that right.

1:16:44So why would you deny parents the right to determine what's in the school library? And it does seem like all of this goes back to you. And by the way, some of these books that have been removed are actually Lord of the fly. Really flexible. Yeah, Lord of the flies will probably get removed because they don't like somebody being labeled fat. Piggy. No. Piggy. Oh. I just lost the weight. Take it easy. No, no, I'm saying, right? Like, there are some great books that were written in an age where, you know, you just say things in a certain way that aren't meant to be offensive but these books are very powerful.

1:17:17And I don't know about you guys, but I had a bunch of books that I read when I was younger that had a huge impact on me. And then the other. I don't want those books getting removed from the curriculum. You're right Lord of the flies I'm not a fascinating incredible mockingbird. Those are all important books that I read as part of the curriculum But all we're talking about it I think is this even this very minor issue of what's in the library Obviously the parents should get to this side and some of the things that have been removed from the library are pretty out there like for example there was one book that Was educating kids on like how to get a grinder date Which they're not supposed to be able to do right like grinders for 18 and up There are other topics that like suicide and harm and other ones.

1:17:58When do you introduce that to a child? Is that something that's third grade or a suicide discussion? When should that reasonably occur? This is a crazy question, but I'll ask it to you guys. I would rather Lord of the Flies be removed from a library than edited because then at least there's a different place where you can get your original book. Oh, for sure. The idea of editing a book is so insane. It's so mind control. Yeah. It's really bad. That idea is very, very bad because you're reading something, thinking that this is what the author intended and all of a sudden it's manipulated by some Randall false expert under some guise that you had no decision making in.

1:18:37That's really bad. What's really, I think, important of this discussion is how the press frames something, how politicians frame them and then how they're actually executed on the ground can be very different. So this has become a Rorschach test for what cause you back. And when you actually look at this list, you'll see people in California, people in Colorado, banning quote unquote banning, or just not including certain books and libraries. It's parents having age -old debates about when do you introduce certain topics to your kids? That's your job as a parent. What happens in the library is going to be variable.

1:19:10All right, Nvidia is going for viral integration. They unveiled their GPU CPU Super Chip called Grace Hopper after the Navy Admiral. Obviously, Nvidia Grace GPU uses 72 arm, your version V2 CPU cores, whatever that means. You see you can deliver up to 370 score on a spec crate 2017 in base, whatever that means. I'm sorry, I'm not familiar with all the benchmark testing. I thought it was the peak of humor on the show. Listen, we're talking about Pentium chips. I could have kept up here, but I had kept up this since the 90s. We're talking about the Intel inside Pentium chips. Yes, I did keep up with chips.

1:19:47I'm sorry. I'll tell you about Mark and the picture. Yeah. No, I mean, when we got past Gigabit, I stopped. I think what's really interesting here is this is a really important moment where like that design, that grace hopper design, which is basically a massive system on chip. It's an entire rig. It's a GPU and CPU and memory and interconnects. This is like them going for the jugular. This is what's crazy in a moment like this. like that is basically them trying to create an absolute monopoly because if you have these rigs and these rigs are the most capable for learning and you have their SDK CUDA which is becoming the de facto software layer now that you use to write to their H100s or Grace Hopper when it's available and the A100s.

1:20:32That could create a level of lock in that I think people should be thinking about. So if you're the hyperscalers like Amazon and Google and Microsoft, what is your reaction to this. If you're Facebook, what is your reaction to this? And I think it's really important, because if these guys continue to innovate at this scale, you're not going to have any alternatives. And it comes, it goes back to like what Intel looked like back in the day, which is an absolute straight -up monopoly, except the differences, that even when you wrote something to Intel CPUs, you could actually run it on an AMD processor and it would work with no changes.

1:21:08is. But that's not necessarily the same. So if you go from an A100 to something else, an FPGA or some other silicon, you have to translate the model. And so it's very important to understand that there's no extensibility here. So like if Nvidia continues to drive this quickly and continues to execute like this, it's a one and done one company monopoly in AI at the hardware were layer. And I think that that people are probably thinking about how to blunt that competitive outcome. But that's what I took away from that, from that announcement from them, which is like, they are ready to go for the juggler here in what looks like the most important market.

1:21:49That's immersion. Like, what do you think about the valuation, Chimap, trading at 200 times or 50 times even down? I mean, your camp, the simple thing about price equity ratios is if you take the price equity ratio and you invert it, that's your implied yield. Price earnings. Price earnings. And you invert it, that's your yield, right? And so, Nvidia is yielding at these prices, I think it's somewhere like 2 to 2 .5%, which is less than, and it's almost half of a typical 2 -year bond. And so, when you have a yield that that's low, you have to see it just grow absolutely massively. But there's this principle in capitalism, which is in order to grow like that, you're generating so much profit that competitors look at it and say, hold on, you don't deserve that much profit.

1:22:37I'm going to take some of that. Your profit is my opportunity. Your margin is my opportunity. I think that your margin is my opportunity is exactly what happens. So I think what I'm waiting for, Friedberg is like in the next two quarters, if AMD, Facebook, Google, Microsoft, and Amazon don't announce something substantive. There's a very good chance that Nvidia runs away with this. And I think that that's a very problematic, but in that case, that price is cheap. My bet though, it's a different version of your bet, but we get to the same outcome, is that I don't think that that's going to happen because it's just too important.

1:23:13And so I think that everybody other than Nvidia wants vendor diversity, right? You don't want to get locked into one person, one set of hardware or one club, you know, one SDK. You don't want that. Nobody wants that except Nvidia and Nvidia shareholders. So my bet is in the next two quarters, you start to see some real action so that folks start to have to balance their forecasts where it's not just a 100 % Nvidia, but it's Nvidia plus plus plus. And that's sort of what I would bet because it just seems like logical and right because I otherwise it would be pretty derelict of these hyperscalers to just throw their hands in the air and just give the whole market to them and it would be derelict of AMD.

1:23:56The other thing that's happening is and you know AMD is a great memory solution, but they really don't have a deterministic AI chip and I think that Lisa suit needs to get needs to act decisively here and build something, announce something, buy something, but she needs to be really aggressive here. If you look at the language models, a lot of them are taking less and less CPU, GPU, to actually build them. So this has been like a bit of a race or a competition on a hugging face. I showed the leaderboard another episode, maybe two episodes ago, but I've been talking to some of the people who are doing these language models to Moth, and they said there's massive inefficiency.

1:24:34And so, and by the way, the other thing they are. A big big mention. Jay Kal is also happening, which is like the the freeberg you talked about the atomization of these models is happening I think even faster than when you first brought that up. Yeah, so what took two or three million dollars last year is now taking $200 ,000 just through software improvements and code improvements. Crazy. And now they're thinking a number, the other thing people are coming to is because of so much, was the term hallucinations that people are using Because of the hallucinations, people are making narrower models that are deeper in legal or just stack overflow, just core or just a vertical in core.

1:25:10They take less GPU, but they get better results because they've constrained the data set and that's resulting in better outcomes. I think this could also be where maybe people don't need as much GPU or CPU at the same time, so many people are going after it, so that could flip where the demand could actually decrease because of software efficiencies or hitting some benchmark that's reasonable enough. What do you think, Friedberg? Look, I think this performance improves as cost declines. Like any economic model, there's a pretty nonlinear relationship with demand. So we'll find new ways to apply this technology.

1:25:48I think the demand's only going to go nonlinear. Everything that's happening is people are starting to build like Mosaic ML. Now, they're building cloud independent models. So you can take the same model, build it on your own proprietary personal cloud, not educate chat GPT4, not educate Bard, but deal with your own model, and then you can move it from Azure. For an introduction and fine tuning, seems to like get to the point that we can run these things on small machines cheaply, quickly. and it'll change the applications. You're seeing run inference cheaper, not run training. Run inference, that's right.

1:26:31Oh no, this is not good. Biden just had a big fall on stage at the US Air Force Academy graduation. Oh no, I think he'll be okay. But whoa. It's not like he fell off the stage, he just tried to. No, no, he didn't. Oh, it doesn't look good, but it could've broke something. Well, hopefully it's okay. I hope he's okay. Yeah, yeah, I mean we just had this whole talk about it. Yeah, I mean it's just again I think like physical like these kinds of physical things are are normal And I think people need to be much more empathetic about that kind of stuff. I mean he was riding a bike over the summer last year I remember And you look great.

1:27:03Yeah, I mean FDR was in a wheelchair So I don't care about that. I'll like care about his mental acuity. Yeah, me too. He's okay By the way, I I want him to be well enough to run because I'm scared of some of the other Democratic candidates that's they might put up. Same here. Yeah. Like, I don't want to get a president new some, or a president Harris. I mean, I don't think Biden is very good, but I think he's better than Harris or new some. Biden drops out who's the candidate in your mind, RFK. Really? Wow. I would prefer RFK to Biden, but I think what will happen if Biden drops out is we'll get a flood of establishment Democrat candidates in the race.

1:27:42Newson, maybe JB Pritzker, Harris for sure. There's a lot of differences between the left and the right, but the one similarity is that there's a large amount of Voters in both of those blocks who don't fundamentally like these establishment candidates And I think that that sentiment is exactly the same and so you know You can have a pro Trump wave on the right just like you could have a pro RFK wave on the left and They are solidified by the same idea, which is I think you're gonna see more and more outsiders have a chance through the nomination process to get in I think their party will stop it.

1:28:17I mean, they should have done birdie sanders. Remember that? Where was sanders against Hillary Clinton? And they shipped them. They rigged the primary against them. Where am I? I'll have to use that word. Oh, they just labeled our episode. No, but look, I mean, the establishment has, in the Democratic Party, as a huge influence over the outcome because they control the super delegates. gets right? They'll never. So wouldn't Newsom supercharge the Republican base? I mean, being like a coastal elite and what's happened with San Francisco and LA, I think that just drives out the Trump voters in a massive way that I said like over a year ago, I thought that the that 2024 would be a Newsom desantis race.

1:29:01I still think there's like a 10 20 % chance of that. Wow, that would be wild. Be wild. Can any 10 %? What about you? I'll mention what's the story there? Anybody have any insights on Joe Manchin. We had a phenomenal dinner of my house last week. He is so charming. Okay. So what do you know this? What are you talking about? I don't know if you publicly disclose it or not. Well, it's already happened. We had a, you know, we had a fabulous dinner and he met a lot of people here and he's amazing. Did Saks come to that? And Heather and Heather's amazing. Heather's amazing too. His daughter who she ran, I think it was my land pharmaceutical, critical, incredible executive.

1:29:43Joe Manchin would jump in, yeah. You think Trima? Manchin's faddles. If Biden wasn't in, Joe Manchin would jump in, yeah? I don't, I don't know. I don't know. I don't want to speculate on anything like that. But I think he's, I think he's an amazing American patriot. Is that your guy, Freberg? Would you go Joe Manchin? Because he wants to control spending? I don't know. I don't know. All right. I'll tell you one of the reasons why I like RFK Junior is that I mean, there's so many issues that he is deviating from Democratic Party orthodoxies in favor of free speech and against censorship. He's in favor of civil liberties and against this massive surveillance state that we've created.

1:30:20And on foreign policy he wants to end all the crazy wars. And I would say that of all the candidates I've heard, he understands the situation you crane the most deeply. Now both Trump and the scientists have called for a ceasefire and that's good. and I think RFK would work towards a ceasefire too. But RFK Jr. goes deeper and explains how the whole situation Ukraine came about. And so he understands it very deeply. All right folks, do you have it? Another episode of the online podcast for the dictator, the architect David Saks, and I won't call him. No, he's a kingmaker. I like architect. I like architect.

1:30:59Okay, kingmaker. Sure. Kingmaker. I like architect. Architect. fake news. You like architect or king. It's crazy. The whole thing was just like made up. No, but I know, but as a nickname, which has a nickname, what do you prefer? Architecture. What do you prefer? Or king? What do the articles say, kingmaker? Arca's a kingmaker. I said architect. I think architect is more shvengallish. The article is about a call that never happened. Big news with a person you don't know with a person I don't know. Right. Okay. That aside, what nickname would you like us to use going forward? Kingmaker. Putting aside that the whole article is made up.

1:31:33Yes. Putting that aside. Architect. Can I go with Kingmaker? I like Kingmaker. I like Architect. But it's silly. Mr. Secretary, please tell us which one. Yeah. Secretary of State. Look, I'm a I'm a mid -level donor. Mid at best. You're mad. Mid at best. Red subreddits are going crazy right now. Exactly. Mid -a -best. And then influencer, I'm mid at best. So I'm a secretary of state. I'm mid mid. However, it's true that there are very few podcasters you probably don't need anything. You could be. Yeah. Henry Kissinger, a medal in all, right? Highest ranking foreign citizens to lead. Yes. I think that you would be an secretary of state.

1:32:12Secretary of state. I'm just going to put that in. So you could be secretary of state. Hamlet, I think you would kick secretary. Because you have the intellectual firepower to actually not get bamboozled on this stuff. You told your ground. You knew who actually I think was pretty good on foreign policy, doesn't know what credit it was, was Jared Kushner. I was listening to an interview with him and this happened like eight months ago and he was describing the whole situation in Ukraine and he says very clearly that he and Trump understood that bringing Ukraine into NATO was a red line for the Russians and they never went there.

1:32:45So they armed Ukraine, but they were very careful to not make any statements about Ukraine coming into NATO. He understood that that was a serious provocation. I'll post the interview in the chat, but it was with I think Gerard Baker from the Wall Street Journal. So Gerard understood the situation better than most of these foreign policy elite establishment types who don't understand how their actions could be perceived as provocative by the other side. Well, he sure secured the bag after getting out of that gig. Two billion. I think I got the Abraham record's done. And now, Biden's just flushed it down the toilet because he's alienated the Saudis so much they've gone to the Chinese.

1:33:29I mean, the fact that there's flights between Israel and the Middle East nations now and they seem to have a common, it's pretty enemy in China. I don't think you understand how much Biden has alienated the Saudis. You want to shake, Biden wouldn't shake the man's hand. What was the point of that? I'm not in favor of Biden. What was that like a fist bump or something? That's a pre -negotiated fist bump. Yeah, it's a little. How insulting is that? The one thing I loved about Trump was he was willing to meet with anybody. My idea for our policy is meet with as many people as possible, as often as possible, and not go to war.

1:34:04I would meet with Kim Jong Un, Putin, Xi Jinping on the regular. Every country we should be in with because that's how progress gets me. Not meeting with them is, yeah, I mean, it's not a reward. I think there's a part of this military industrial complex that believes a meeting with the president is a reward or an endorsement of the worst things anybody's ever done. It's not. It's a meeting to try to make the world safer or to try to build common ground. And so that is not me or Jim Kramer, however you want to try to frame it. It's intelligent and I'm for intelligent foreign policy which is talking to people Let's talk about some people who said yes to come to all in summit.

1:34:47Let's just do a quick speaker I gotta go I gotta go watch. I love you guys. I love you, but I see yeah fuck this I'm done with this shit. Yeah stop free brick. I love you

1:34:59Well, like your winners ride

1:35:08source it to the fans and they've just gone crazy with it. I'm the US, I'm the queen of Kenwa! I'm going on a beach! What? What?

1:35:20Besties are gone! Go through! That's my dog taking it away. I wish you drive away. Sit down. Oh man, my ham is actually a meaty ass. We should all just get a room and just have one big hug or two because they're all

1:35:56What your the beat