Volatility In Markets: Friend Or Foe For Your Portfolio?
Summary
Precious Metals: Extensive discussion on gold and silver fundamentals, volatility, and alleged market manipulation, with focus on physical scarcity and pricing gaps between China and the U.S.
Silver Arbitrage: Noted persistent premium for silver in Shanghai vs COMEX, implying broken price discovery and tight physical markets despite futures-driven price smashes.
Gold as Tier-Zero: Framed gold as a counterparty-free asset amid currency debasement and rising central bank accumulation, with historical Weimar volatility as a caution for drawdowns.
Japan Macro Risk: Bank of Japan’s balance sheet tightening versus fiscal stimulus is pushing JGB yields higher, stressing the yen and raising odds of a carry-trade unwind and broader sovereign debt tremors.
Venezuela Oil: U.S. move to control Venezuelan barrels and future flows highlighted, with heavy-oil economics, diluent needs, and geopolitical/legal backlash risks limiting near-term supply relief.
Fed & Liquidity: Fed balance sheet expansion stoking leverage and risk appetite as global long-duration yields rise, complicating the market outlook for bonds and equities.
Sector Rotation: Talk of software margin risk as AI commoditizes coding, with a potential shift toward semiconductors as the AI infrastructure beneficiary.
Portfolio Strategy: Emphasized adaptive, evidence-based allocation, planning for volatility, and disciplined accumulation strategies in precious metals while preparing exit frameworks for future tops.
Transcript
Nothing in this program should be considered investment advice. It is for educational purposes only. Please hit pause and read this disclaimer in full. Look, there's a lot of people that have been stacking silver and gold that are really giddy about the prices right now, and I am too, okay? I love the long-term fundamentals, but I'm trying to prep everybody that there's more than likely going to be some gut-riching declines that are going to occur as this process unfolds, just like you're showing there. Hello everyone and welcome to this episode of Finance U. Happy New Year. It is now 2026. Paul and I have been off for a couple of weeks doing the holiday things with family and all of that. So Paul, welcome back to the show. Good to see you. Happy New Year. And um >> happy new year to you as as well, Chris. It's nice to see you again. >> Last we heard you were settling into being a grandfather for the first time. How's that going? Oh, that was phenomenal. Like the best Christmas ever. And u I'll tell the quick sto short short story about being a grandfather. You know, I'm holding my granddaughter and fed her. She has her, you know, bow movement and I hold it up and say, "Okay, grandfather's last line of defense. So, which one of you is going to change the diaper?" [laughter] So, it was great. I got all the joys of feeding, holding. It was wonderful. It really was. And just fellowship around the family. So, it was it was it was great. >> Well, that's wonderful. And and let's carry that glow into this conversation, everybody. We're going to be talking about um gold and silver, obviously. Uh and we have to talk about what's happening in Japan because we've had a thread, Paul, about that. And it's more is happening there. And we're going to talk about a little bit about what happened in Venezuela. I want to talk about the oil realities around that. And then there's a few other things we should talk about like the Fed expanding its balance sheet. And that's fancy way of saying printing money. So, hey, brand new year or is it where are we at? Um, and we said this back on October 3rd. Actually, we've been talking about this all last year, but when we said this, you know, gold and silver are screaming, are you listening on October 3rd? I put up this chart, right? And it showed gold at $4,08 with that nice little Leslie Nielsen um meme there. Nothing to see here. >> That's great. Yeah, and we saw the same thing. Silver, we said just on the cusp of breaking out of it. It's a long-term former high cup and handle 4854. Now it's closer to 80ish. And I say 80ish, Paul, because this is last night all day. Well, all day yesterday, oops, let me come over here. We saw the gold, the silver was just, you know, rallying all the way through right up into the close here at 4:00. And then there's this mysterious little mesa. What I don't know what chart pattern you call that. It just couldn't go up or down. And then boom, it just This is Well, let me look at this more closely. This is what that looked like. This is where I call shenanigans. That is totally unnatural market behavior right there. They capped it. Whoever they is, they capped its price and then they pulled the rug. And this is what they do. And by the way, they had just done this same trading pattern back on January 2nd when they were defending the 7450 mark. You can see it right here. Same thing. They pulled it and then what happened afterwards was this big decline down to about 7180. And I like how Steve alarm put it. He said, "No signs of capping the silver market silver price so far this morning. I'll keep you updated if I spot anything suspicious. [laughter] >> That's great. [clears throat] Sarcasm helps. [laughter] So let let's look at those shenanigans because it is shenanigans and I think it's important to discuss because the world is catching on Paul and these are the things that destroy markets because people start to go and by people I mean international trading partners start to go wow I can't trust you guys this you have fraudulent manipulated markets and that's just pure evidence to me of fraud and manipulation. So, Peter Spina of um or Spinum, I don't know how to pronounce that, Goldseek has wrote here a 1h hour silver spot price chart to show the price smash last night in two phases. The first wave was 30 million digital ounces in 15 minutes. And the second was about 20 million paper ounces traded over a second 15-minute window um with a little bit less of a price drop. But that's 6% of global world global world global annual silver world mine output in just two little dumps. Um, and that's just how that goes. Uh, so we're seeing the same old same old. But Paul, very hard to find silver right now um for sale even in the US, but I hear in Singapore, Dubai, China, it's like really in short supply right now and much more expensive than what you see here in the US. So that's that's not a market anymore as far as I can tell. >> No, that's not a market. Well, and that's not a market. And what people need to understand is traders have somebody that they've got to answer to. And if you're a trader and you're you're ex you're selling that much at once and you're driving the price down on your selling, that's that's not normal. I mean, no no trader is going to keep their job if they're doing that. So that's the one thing that I know about the trading markets that this is not fiduciary management. This is something else besides somebody deciding they want to sell everything at 3:00 in the morning when nobody's there because you want to maximize your price when you're offloading if it's for profits [snorts] and you're going to you're going to have a program trade that's going to take that out over a period of time. What we're seeing here is yeah, it gets consolidation. Maybe they're starting the consolidation and all of a sudden they're slamming that price down and there's lots of money being now if they're shorting it that's one thing. They may be making money on that side but that's just absolutely ridiculous. uh uh behavior. No institution is going to keep a trader who's operating that way. We don't see it in stocks in general operate like that. >> Well, it's it's it's not price discovery, right? It's price setting, right? If you want the price to go lower, you wait for a thin market and then you dump an overwhelming amount of sell orders into that little tiny moment and you set the price lower. That's that's all. But but it's it's it's it's this little telltale totally unnatural messa formation where like nothing like you can just like that sends the bat signal out to every computer algorithm out there warning we're about to execute a sell program. You never see that before buying, right? It's just that they cap it and they said that's enough fine. It's going the other way. Um but I think they're losing control of that. They've done this several times over the past few weeks. There was a period of time between basically Christmas and January 3rd where China was offline for four days and the the raccoons came out and they did everything they could including that January 2nd hold and smash everything they could to drive it down. And when we woke up on January 4th when China's art markets opened again, silver there was $89 an ounce and we were at 72. Uh, so obviously we climbed all the way up to 82 because you have to get closer and then we smashed it back down. There's currently about a $9 gap between what silver is allegedly being priced at on the US comics and what physical silver costs if you want to buy it in Shanghai and Paul that shouldn't exist. And here's why. If you're in the business and you can actually buy a million ounces of silver today off of comx and you sell forward so for a month from now in the Shanghai futures exchange a million ounces you can make $9 an ounce you're going to make $9 million less insurance transport and some other fees right but let's say you you're going to clear $8 million bucks for about 20 minutes of work >> in a functioning market that doesn't exist. That's called arbitrage, but it shouldn't exist. So, but it does exist. Tells me the markets are kind of broken right now. >> That's right. It is. The only other thing that I can think of now there are export controls out of China on uh silver coming back to the US now. Correct. >> Right. >> So, if I'm there are, but I don't know if they've been exercised or not, but it has to go up the chain of command now. You can't just decide to export silver as a as one of the silver exporters. Okay. >> You have to get you have to get permission. I I don't know what levels of permission have been granted or withheld. [clears throat] >> But that's that's pretty amazing that there's that big of a spread over there. They're closer to true price discovery obviously than what we have here. >> Well, it it just tells me that those million ounces, you can't get your hands on them in the US. So, this is the ultimate in a fake market. I've been talking about this for years. Here's the fake market. They set the silver price in the futures and they say, "Oh, it's $72 an ounce now." [snorts] But you just can't get any at that price. That's not how markets work, right? A market is where if if there's none available at that price, the price rises until some becomes available. That's how it would work. There's a price at which somebody will start selling their silver again. The fact that there's no silver available at 72 is people saying, "That's not my price. It's not a market." >> That's right. >> It's not a market. >> That's not an honest market, for sure. So that's not a market. And if the market's not honest, it's not a market. >> Well, this is a problem because I I personally, Paul, I consider that um at least half of the United States's relative financial strength is because we have the deepest, most liquid financial markets. And even though silver is this little tiny little thing, it's now telegraphing to the rest of the world, these aren't markets you can trust. They're markets, you know, put quotes around them. But if we ruin that, we're going to be really sorry if if people leave our capital markets and say, "We can't trust you. You know, we're gonna we're going to deal with China, Singapore, Dubai, anybody, because we can't trust your markets." That's whoever is doing this, I think, is exceedingly shortsighted. In fact, I think they're damaging the country. And I wish we had some sort of effective oversight and regulation or even prison time cuz I think willingly knowingly damaging the country is um should be frowned upon if not punished >> and the long-term consequences are severe. So the one thing that's made the US the light in the world especially economically uh throughout history you know many things but one of the things is the rule of law. So you had the rule of law and there were consequences uh through the judicial system if you got outside of that rule of law, right? And we've respected that for quite some time. So that was a benefit. If you're a dictator, authoritarian in another country, you do whatever you want to do. There is no rule of law. You're controlling the court. So in the United States, that made us a shining beacon over that period of time. But the rule of law doesn't seem to matter anymore. We've seen it with rules for thee but not for me with the with the ultra rich being above the law and been able to work their way through the courts. So that that's that's just another sign of this fourth turning and this change that's coming to place and the consequences of weak men and women in the halls of power. Agreed. So let me carry on with this silver story real quick. Uh it's getting exceedingly volatile now. So, I don't know if you can see down here, but but these are whole like this is these are like five, six, $7 bars up here. It's getting really volatile there and choppy. Two ways to interpret that. Some people say, "Oh, volatility happens at the top and it, you know, then then the decline maybe." But Peter Spina again saying, I'm going to say Spino looks like a spino. Welcome volatility. The daily silver price moves are quite extreme, unlikely to come down anytime soon. And this is where one way to interpret this because we've heard about um the dollar deleveraging the people walking away from the dollar, the debasement trade. There's all this ways we could talk about it. Um but I just want to put this up again because I think this is important. We put it up once a while ago. This is the gold price in Weimar Marks starting here in 1914 during the famous Weimar hyperinflation when their when their currency got completely destroyed beyond debaseed. And what's interesting is you see here the gold price and it just you know if you just saw that rise you'd say oh yeah I would have ridden that wave but would you have because now we're looking at the percentage change in gold price on a monthly basis and right here oh my gosh this is down this I put this bar down this that's a minus 25% decline so would you have really held on to gold when it got clubbed by about 20% just eyeballing that right and then it's rising again but during this month it was down another it was a 20% draw down in a month, right? >> That would be like taking it today down to about 3,800. I mean, 3,300 or something like that, right? >> People go, "Oh, get out. Gold is dead. It's dead." You know, and then we have a 25% draw down and then a 10 and then another 25% draw down. But even here where it's like you only want to be in gold, there was another 25% draw down. Just to say volatility is a normal part of the process of your money dying. Well said. And that's one thing that I want to reiterate to listeners out there, and I've been telling clients this. Look, there's a lot of people that have been stacking silver and gold that are really giddy about the prices right now. And I am, too. Okay? I love the long-term fundamentals, but I'm trying to prep everybody that there's more than likely going to be some gut-riching declines that are going to occur as this process unfolds, just like you're showing there because that chart has been shown and I love the fact that you've pointed that out because that's wisdom for the listeners that are out there when you know, one I'm not seeing the type of environment where you have the ultimate top and in and even gold or silver right now, at least with the information we have right now. At least in the United States, you don't have that retail demand that's out there. Prices move so far so fast, most people are frozen even if they want to purchase it. From a long-term investor standpoint, this is a very hard place to be as well cuz we had the fundamental story, we had everything else that caused us to be in it, and now you've had this massive price rise in the short run. Well, sometimes that's the point where you want to sell and diversify somewhere else. But you you have to have other confirming indicators and other tools, but when you look at the fundamentals, you look at the amount of effort that they're putting in to try to suppress the price and how quickly it's recovering now. I mean, Chris, that much effort back in 2018, the price of silver would have been down for 15, 16 months before it recovered to smack like that. Mhm. >> And now it's not even lasting for a couple of days. So, I do want to stress those that are holding right now. Prepare yourself mentally. And if we don't get those declines, then okay, you prepared yourself for something that didn't happen. But if if we do get those declines, you need to be solidified in the reasons why you're owning that from a long-term standpoint. And if I start seeing the longerterm indicators that scream that we're close to at least a longer term top, then I'm going to be talking about it. But I just don't see that right now fundamentally. I mean, you've pointed out all the fundamental factors that are there, the geopolitical issues that are taking place, the manufacturing demand that's out there or the industrial demand that's out there, excuse me. So, that's a great chart for people to go back and look at and pay attention to because because I can tell you in that first price uh uh price spike that you saw there starting right before kind of midways in that chart right above the R, >> you know, there's a lot of people that have been in there that that that selloff would have made them think that it was over, especially with how the prices have been hit since 2012. And that's going to shake weak hands loose. Yep. >> So that one and then especially the next rise there. >> Yeah. >> That one right above there. >> Yeah. So that's the point where I think it would have tested a lot of people. >> I agree. And over your shoulder if people look, it says invest your plan, not your emotions. And this is emotional. It's Paul. It's so hard to sell when it's just making new highs because you're like, whoa, I I want to I keep riding this. It's even harder to buy when it does this down here. Yes, >> but and I'm not saying this is a perfect analog and I'm not saying this is what's going to happen in this chart. However, your dominant strategy would have been to buy every dip. >> Mhm. >> That would have been the strategy, not to sell out because it was, you know, got clocked for 25%. But to buy then, but I recognize it's really hard to do that. It It's just hard because you're going to have all these and particularly now with AI and AI headlines and all the marketing. particularly here in the US. I don't think they're as confused about this in other countries because they don't spend so much time trashing precious metals, but we do in this country and people have to be aware of that. And so when these dips happen that look like this in the US, you're going to be flooded on CNBC, Yahoo Finance, wherever you, you know, Wall Street Journal, Bloomberg, wherever you get your financial news from, and they're going to be telling you, "Oh, it's over. You know, smart people are selling. Smarter people sold a little before. um you know, stupid people are holding on. They're going to use all this emotional language, which is the definition of propaganda, to convince you to get out of the one real thing that could potentially protect you from >> Yes. >> the rest of the system, printing money. >> Yeah. >> Yes. Well, and I'll tell you one thing that's amazing to me. Nick and I were talking this morning. He reminded me of it. He mentioned the name. I can't remember the name, but I had had over the past couple of weeks probably 15 20 different people send me the same video and it's the guy talking about silver and 80% facts were right. >> The the Asian guy the but it's pure AI and it's half propaganda by the way. >> Yes, you're exactly right. So when I first started looking at it, it took me about two to three minutes to realize, okay, this is AI. Okay, so I I picked up on that. But then I went back and started paying attention, you know, how much are facts? And I just responded to everybody and said, "Hey, this is an AI video. There's some facts in there that are correct, and if you're not paying attention to all the details, you don't recognize the propaganda that's associated with it." So, you know, unfortunately, we're in this environment now where with the use of AI, that propaganda becomes more powerful and more powerful and more powerful. And I was having a conversation with some friends here recently. I don't know if you've noticed every sitcom that's out there that's funny, the guy is stupid and the and the female is you you know like like the the smartest wisest individual out there and and I was they they were teasing me why I don't watch those. And I said I don't watch them because propaganda works. It gets into your subconscious. You see it on a consistent basis and you have to cut it out. So, I think we're in an environment now where a trusted source becomes uh even more important to pay attention to and be very careful about, you know, something that you don't know someone's track record with and and especially making investment decisions on it because AI is getting far better than what it was just 3 months ago and harder to even notice. So, you have to pay attention to all the details of what they say. You can't just passively listen to it. you have to actively listen to it >> and that's becoming harder and harder and harder. I would say half my feed on Twitter now is just and not I won't say it's all AI slop. Um because some people legitimately use it to help craft a point they're trying to make. But as soon as I recognize I'm not reading their words, but I'm reading their thoughts expressed in AI words. I I I discount it by at least half. And if it's pure AI slop, I just I actually block the people now because I don't have time in my life to to even have to wrestle like for 5 seconds to go, oh, this person is feeding me slop. If it takes me 5 seconds to sort of does discover that block I because I don't have time for this anymore. I really don't. I don't care what Grock thinks about something. It does great on structured thinking and, you know, it does good math. I don't care what it thinks about geopolitics, politics, um, current events, uh, any of that. I I don't care because it's not it's not a human. >> I had a a friend that was telling me that we was asking Grockett's opinion on a decision that they should make and I'm like, man, that's really dangerous. Use it for facts. Use it to to find information in the tax code or whatever. But if you start asking it what you think and how I should behave in this way, it's a very dangerous thing to do with [snorts] AI. Well, it is because we we know that if if like if you get bedridden for just two weeks, all your muscles start to atrophy. This atrophies real quick when you start outsourcing it. Um so, use it or lose it is kind of how I I feel about the whole thing. All right, folks. When we come back, uh we're going to hear from our favorite sponsor right now, but when we come back, we got to look at the huge spread that exists between the price of silver in China versus here in the US. We'll be right [music] back. Today's markets are more volatile than ever with ongoing economic and geopolitical uncertainty. Navigating such environments requires thoughtful, adaptive strategies, not a one-sizefits-all approach. At Peak Financial Investing, our registered [music] investment advisory firm connects clients with experienced wealth managers who focus on active [music] portfolio management. These professionals use evidence-based strategies designed [music] to respond to changing conditions, not outdated formulas, but customized [music] approaches grounded in research, discipline, and risk awareness. We believe in open, informed conversations, including discussing tools like precious metals and diversification as [music] part of a broader financial strategy. Every investor's situation is unique, and our adviserss tailor [music] their guidance accordingly. Visit peakfinaniallinvesting.com today to schedule your free consultation and explore [music] how proactive management can support your financial goals. I'm Dr. Chris Martinson, [music] proud to work with Peak Financial Investing and my support reflects my professional views. I encourage you [music] to take control of your financial future by making informed decisions. All right, welcome back everybody. Paul, I want to move on to um just finish up a couple things in silver because there's two other big moves here. So, this is the this is expressed in a premium discount um and all that. So, remember in January of 25, silver was like 30 bucks an ounce. So, it might look like it's kind of comparable. So, this is expressed as percentage, not dollar terms, but look at what's been happening of late. Huge, extraordinary. This is that volatility. This just says silver is a lot more expensive in China than it is here. And this should not exist. The normal premium person should be hanging out around maybe 3%. Right-ish. Um you know we had one little clock down here in October which we discussed back at the time. But um look at this. This is enormous. And so this just means that the markets are fracturing. There's a market in China that's different than the market in the US. and that you can't. Commodities are not supposed to work this way. It can't be true. Let me take silver out of the game. What if you found out corn today costs $12 a bushel in China, but only costs $5 a bushel here? Well, somebody's going to load up a grain ship [laughter] and send it over to China. And those two prices are going to are going to equilibrate really quickly. And the only reason they wouldn't is because we don't actually have the corn to put on the ship. >> Mhm. to send over there. That's what that tells me is that we're we have a fiction which is that oh, we got plenty of silver. It's cheap. You just can't get any. >> Yeah, >> that's where we're at. [laughter] >> Yeah. It amazed me because I've I've made a couple of phone calls looking, you know, expecting to buy silver when Holly Kate was born and it's what, three, four weeks before you can get it at this point where where typically it was shipping next day. So, here's a question that I've got for you, Chris. Maybe another thought that I have. I know you've pointed it out and others have talked about it in the past. I cannot remember who it is. I'd love to give them credit, but years and years ago, I heard somebody predicted that these precious metals are going to leave the West and they're going to go east and they're never going to come back. So, could it also be that if I'm China and I recognize the long-term issue when it comes to silver, precious metals, and our currencies and everything out there that you're going to incentivize a higher price so that so that it's sold and shipped over there and it'll never come back this way. Do you think that could be a part of it as well? >> Well, absolutely it is. And you know I think one of the bigger dynamics out there is that um both in India and China which collectively is allegedly around two and a half billion people uh with with middle classes and upper middle classes that dwarf ours in terms of just numbers right because it's a numbers game and they have traditionally been high savers like 30% savings rates it's more like 12% in the US so they have a lot more savings to work with and they don't really trust their stock markets and real estate just burned Um, so what's left, right? There's not that much left. And of course, they have capital control, so Bitcoin isn't really an option in China. So what's left? Well, that that's where at least some of that buying pressure is coming from. Two, we just found out last time we talked or was it the time before that gold was creeping up on dollar reserves on a dollar basis in in central bank reserves. Last week they crossed over. Gold is now uh exceeding dollars in terms of bank reserves across the world. It's a big moment. >> Was that dollars or was it just treasuries that that >> No, this is total this is total dollars. You're right. We talked about it in terms of treasuries. Treasury holdings. >> Yeah, >> I could find it, but it' take me a minute um because I didn't I' have to scoop that back up again. But you know because if you actually revalue gold in current terms like it's just banks might not have bought a whole lot more gold but it goes up 100% in price value uh you know the reserve ratio climbs like that but it's very clear I heard from a big trader who operates out of the east um they told me that for gold the buyers now are just price insensitive they're just like they they're they're ounce sensitive not price sensitive or gram sensitive or kilo sensitive price sensitive. >> They just want to have ounces, grams, kilos. >> That makes sense. It's the most trusted asset and at the extremes, it's the better asset to own because if you have deflation, you don't have to worry about counterparty risk and you have hyperinflation. You've got a limited supply. >> Yeah. >> So, it does make sense. >> Well, I'm I'm going to I want to go further. Nick and I were talking about this and it suddenly or no, Tom and I were talking about this. Hey, Tom M. Um, so it suddenly occurred to me that, you know, I was talking it through. He's like, "Oh, you know, what was the impact of the Basel 3 Accords?" I said, "Well, you know, one of them was gold got moved into a tier one asset means it's on the same par as cash and treasuries." And I realized actually they ought to come up with a tier zero because if you hold gold in your hot little hands of your bank, for instance, or me or you, it's a tier zero asset because nobody else is the counterparty to it. >> If you hold cash, the counterparty is the Federal Reserve. Are they going to print more of them and debase it? You know, is the US government going to overspend them and debase it? Treasuries, you got a counterparty still, right? So, gold has no counterparty. And that I think elevates it to tier zero. And so, way back in the day, remember it was JP Morgan said, gold is money, all else is credit. And I mean JP Morgan himself, what he said that about 1906, I think, or somewhere in that early 1900s. >> Yes. >> Gold is money. All else is credit. Okay. So gold is the ultimate settlement, right? It it it settles itself like it just exists. It it doesn't need something else to happen for it to have its for its value to exist. So I think that actually places it above and that to me explains why institutions, family offices, countries, central banks have become a little bit price insensitive because the flip side of that coin is they're worried about settlement. They're worried about counterparties. They're worried about debasement. They're worried about all these other things that you can't control for. >> Mhm. >> Unless you have gold. >> That's right. >> I think that's I think that's part of the dynamic. >> That's well said, Chris. That's a very important point. And and another aspect is as you're going through that, I can't help but think, you know, that they've demonized the ownership of gold and silver for so long and even your major institutions on Wall Street now will still not recommend it at this point. And you know, my thesis has been that the crypto, especially the Bitcoin, uh, maybe it's in a power struggle between the West and the East, whatever that is, it seems to be a relief valve from everything that I see to reduce the demand from US retail dollars and investment dollars to go into gold and silver. Well, if it's such an ancient relic and and it can't be used as a monetary base, why are the central banks of the world buying it? Why are the big institutions buying it? Right? I mean, they're telling us one thing, but watch what they're doing, not what they're saying. And and that's just a lesson great for anyone in their lives, but what they're doing is they're accumulating that metal in a dramatic fashion. You talked about, I think you were the one that pointed it out, you know, the Indian banks this month uh are allowed to loan use as collateral silver 10 to1 on gold. That's incentivizing their banking system to uh to accumulate silver. So, you know, the East seems to be making a lot wiser decisions than what the West is at this point. And and you know, traditionally, they're very good long-term thinkers. And we've become very short-term and instant gratification in our country. And nobody's thinking long term at this point that they're just not. I mean, the the whole media cycle, the markets pushing it, get rich quick, the the rise of gambling like it has been, that's a problem. Dave Ramsey was just talking about how that's, you know, the the sports gambling is destroying the the the younger kids now because they're it's just incentivizing gambling. That is not long-term thinking. That's not how you build long-term wealth within a economy, individually, countries, or families. You have to think long term. Well, at the tail end of of every debasement, I was reading one of these Will Durant history books, you know, big giant tomes, and talked about Athens, uh, sometime BC. And this is at a period of time where they debaseed their currency, and it read just like today, you know, the the the wealthiest families became even wealthier and the scions of that those families got engaged in speculation, which ultimately just turned into gambling and there was all this debauchery and sort of a breakdown of social mores. A lot of things happen when your currency breaks down on you. It's a terrible thing. It really it's a very bad thing. And if you want to destroy a country, there's no sure means of doing that. The British understood that when they were trying to fight us in the Revolutionary War, they they uh they counterfeited tons of these things called continentals, cartloads of them. And they they understood perfectly well back then that if you debase a currency, you debase every transaction. You debase people's faith. you sap their will to do anything productive, it's it's very destructive. Um, and I think the Chinese understand this maybe better than most because their LA maybe they've changed this, but last I heard their actual term, their their Chinese character for a a a paper note, it's called um flying paper. They don't call it money. >> That's wonderful. >> Flying paper, [laughter] right? can noting that that back they've been through multiple iterations of this stuff and it just ends up flying, you know, it's just becomes useless, right? So, so we're on that path and there's still time for people to get prepared, but just you got to read the warning signs for what they are, you know, and and that's what I'm seeing in the gold and silver markets is >> yes, acute warnings. >> Absolutely. And look, for for those that that don't have exposure, this is not a recommendation because I can't give a recommendation unless I'm talking to you individually. So this is just educational p purposes and strategy, right? [snorts] Develop a plan. If you have none, develop a plan. It can be as simple as over the next six months on the last week of the month because typically you get a big slam on the last week of the month. I'm going to average in, you know, a sixth of whatever I'm going whatever is appropriate for me to allocate into. And if we do get those 10 or 15 or 20% pullbacks, then you double your purchases. Okay? So in that case, it keeps you from being frozen. If this price just continues to climb like it has been, yeah, you didn't get as good a price as what it would be if you bought it today, but you're also not going to have that that gut-wrenching emotional pain if you allocate fully today out of a panic and then next month it's down 15 or 20%. I you know I'd still think that you're going to be fine from a long-term standpoint, but work a strategy and keep some powder dry so that if they are successful for an intermediate period of time for whatever reason to smack that price down that you've got some capital to take advantage of it. But and that and what I have found is that helps people not be frozen like a deer in the headlights, right? And and it keeps them from panicking purchasing. Work a plan. control your emotions as much as you can until you get to that appropriate amount for you and your situation. >> Indeed. Indeed. One last thing to talk about in the silver market um which is kind of interesting is this that uh the United States government, remember we secured some interest in Intel and other companies and like that. But now the Department of War, still mislabeled Department of Defense down here, somebody hasn't quite caught up with the with the latest. Um, uh, the Department of War, I think, threw a couple billion dollars into a refinery. It's going to hold a 40% stake in a in a smelter in a joint venture. It's going to be in Tennessee. So, this is finally, Paul, I think, uh, this is positive in the sense that finally finally, I've been screaming from rooftops for 20 years that we ought to have our own domestic supply chains and also stores of these things because you need a deep larder. And the United States has made this, I think, tragic error of outsourcing everything from the from the smelting on through to the fabrication of the finished products, right? It's one thing to get iron out of the ground. It's another thing to have 62 grades of chrome alley, you know, high-grade steel that you can use and things, right? There's a lot of steps between here and there. We've been content to just buy this stuff from other countries for the most part. Let our own domestic industries and most importantly, our domestic knowledge atrophy, if not completely, go extinct. And this is at least maybe a a reversal of that saying, hey, maybe we should own the beginning of the supply chain. And there's more after this. It's one thing to smelt and refine metals. It's quite another to turn them into the all the grades of products above that. But we're going to have to start doing this. I can't imagine anything stupider than saying, "We're going to go to war with China, but we're going to have to call them every Tuesday for a resupply of the missiles we're going to shoot at them." [laughter] >> Yeah. No kidding. Isn't that terri? I was I was really excited to see that news there. I really was because because it it just builds security like you're talking about within our country. It makes us more independent instead of codependent. >> Absolutely. Moving along. Um various colored flags flying over Japan. Um uh and and Japan's hard to make sense of. So I Paul, I had to turn to a children's book. Um you remember Dr. Dittle series? I read these to my kids and there's the push me pull you, right? It's this it's this creature up here which has a head facing one one's pushing, one's pulling the push me pull you. So to me this is Japan. It's the push me pull you. So the push um record-breaking 122 trillion yen budget which for Japan is a lot. A yen is aboutund what 55 to the dollar. So it's just under a trillion dollars but for for for well well under but I mean for Japan that's a big deal. So that's announced on December 25th. And at the same time, Bank of Japan is tightening. So you got monetary stimulus coming out one end and you got tightening on the other end. And the tightening is winning right now because we're seeing yields fly up. So this is Japanese 30-year yield spikes to 4.65. Actually, it's at 4.99 just a few minutes ago when I checked. Um, but anyway, this this is the highest in history for that series. is the 30-year Treasury yield. And so the they're on fire, and not in a good way. Um, same thing, we see this, the Bank of Japan, uh, they cut 500 billion from the balance sheet. So, they're trying to save the yen. Remember, that's what we talked about, um, is that when you get into the problem Japan's in, you either save the bonds or you save the currency. They save their government JGBs or they save the yen. What does that mean? Well, if you want to save the currency, you have to let the bonds go because that means you're not going to as the bond yields rise, the Bank of Japan isn't going to print money, which makes the yen weaker to buy the bonds to keep them contained. So, they just let the bond yields rise and so that helps save the yen. So, they're clearly saying Bank of Japan is like, "Dude, we got to save the yen." On the other side, you know, you got the the government of Japan saying, "Ah, forget the yen. We're going to spend this like crazy." Those two things are fighting each other right now. And that's why we see this craziness, which is the 10-year yield partying like it's 1999. They say here it's the highest level it's been since 1999. Um, and that's the 10-year yield. We were looking at the 30-year yield before. So, in the push me pull you, yields are flying. The yen should be strengthening. It's not. It's bouncing along. It's it gets the yen is getting weaker as it goes down in this way because it's expressed against the dollar. So, um it it's it's at a kind of a critical level. And these things here, Paul, if you see this, this is basically from 2020, we're watching this scream up like this. From 2020, we're watching the yen get weaker and weaker and weaker. This is an untenable situation. Something's going to break. >> Remember Silicon Valley Bank? Why did they go down? because they were oversp speculated in in the uh 20 and 30-year bond or treasuries, 20-year treasuries. And when rates went up, all of a sudden, they don't have the liquidity to survive. So, you're going to have something break in the Japanese banking system. I'm assuming they're working the same way that the US is. You're going to have their currency crack or ultimately you're going to have all of that take place at some point. And then that's going to have re reverberations that are going to ripple like a massive earthquake around the world in the financial system. It >> it will. And I don't know how this resolves, but remember things break slowly then all at once. Um, you can really feel the pressure building in the Japanese system. This is not what's supposed to be happening. What what's supposed to be happening is we should be seeing the yen strengthening. >> Yes. Yes. >> Right. And we're not seeing that. So, in the push me pull you, you know, there's obviously huge amounts of pressure to stimulate the economy and the the new um uh prime minister over there, Takichi, is uh just going to spend like crazy. Bank of Japan's desperately trying to like keep all of this contained, keep the Japanese bonds from exploding too fast, but hopefully without tanking the yen. And this is kind of a critical level. A lot of people said this bounces right at the 160, 160 yen to the dollar. A lot of people have said that's critical. I don't know why. Maybe it's a round number, but you can clearly see they've been defending this as best they can and it's cost them an extraordinary amount in yields. And the problem is that this becomes a fiscal crisis for the Japanese government at some point because they're going to want to borrow that money. They're going to have to borrow it at a higher yield. That higher yield is going to have higher interest payments. Those higher interest payments are going to make them have to borrow more. As you borrow more, you have higher interest payments. So it they could get into that part of the stage and and that's the concern. And of course then who even knows what that means for the carry trade, whatever that is. I've asked a lot of people, Paul, how big is a carry trade? Nobody knows. But it's big. Um it's huge. And it's strategies that have been embedded embedded especially on Wall Street and hedge fund community for what 20 30 years since Japan started their markets cracked in 1989. 30 40 years now. >> So uh near 40 years. So, you know, and all they're doing is buying time at this point. It's not fixing the underlying issue. It's just buying time. Are they trying to kick it off to somebody else's watch? Is that what this boils down to? Instead of just ripping the band-aid off now where where it's easier to deal with than it would be on the other side. The longer you put this off, the worse the consequences are going to be. >> So, let's say you're in Japan and like you're selling these bonds. They're just toxic now at this point. You don't want the bonds. You really don't want to hold anything in the end. So you really only have two outputs there. One is gold and the other is your domestic equities. Um those are your other sort of relief valves in the story. And on that front, despite everything we're talking about and the the potential for a catastrophe of currency or a bond catastrophe, you see here that Japanese stocks have just been on a 45 degree ups slope. Um, and so this could indicate that what's happening now is that you're seeing the domestic uh sources of e of capital, flee the bonds, back away from the yen, but putting their money into something that represents a more tangible sense of ownership and a profit-making enterprise. Or if I showed you the I don't have it with me right now, but but gold priced at yen. It looks like looks like time is about to bend backwards. It goes up so steeply, you know. >> [laughter] >> It's like a It's a pure parabolic. >> You showed that chart a while ago with the with their longerterm yields and gold price and and you can see it's matching right in line with it. It's it's quite amazing actually. >> Yeah. So again, Japan is my darkhorse candidate to really get the party started. Um which is a debt crisis. We've known we've we're going to have a debt crisis at some point. Remember stocks are for show but but bonds are for dough. we have a a sovereign self-funding crisis and you know if it breaks in Japan I think it spreads to the US very quickly because right now >> it turns out foreigners are backing away from US treasuries for good reason right seizing so Russia's sovereign assets proving they're neither sovereign nor assets playing funky do stuff with the swift system the Venezuela stuff we'll talk about that in a minute um but they're starting to back away who's buying all of our paper we're still printing a little over two trill ion a year for for US government paper. >> That's that's a really good question. I would say I would say a lot of the administration is really happy of these lifestyle funds that the older you get, the more it forces into the bond uh bond and treasury portfolio because there's also passive investors that are going into that area and they don't even realize it, most of them when I tell them. So, I mean, that's an issue long term. Let's keep our eyes on things because the 30-year Treasury is now um it's only back to where it was in September, but it's not going down. It should be going down because we're in a rate cutting cycle. It's going up, not down. Um so, it's not at anything close to a a desperate level at 4.88, but it's a little bit of a worldwide problem here where we're seeing Germany, Britain, France, US, Japan, all of their longdated papers uh yields are going up, right? So that speaks to maybe there's there's a a longer term some something else is brewing here. Um don't know. Anyway, something to keep an eye on. But um hey Paul, we're going to take another quick break. When we come back, we're going to talk about this uh the whole Venezuelan thing. There's some really important things we should be talking about here. So uh as soon as we come back from this quick break, uh we're going to talk about the Venezuelan oil industry and what it means. 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Take charge of your future, folks. Don't wait for the system to fail you [music] any further. Head over to peak.ban/goldcore. That's peak.fban/goldcore [music] right now and claim that free storage. You won't regret it. I sure don't. All right, welcome back everybody. Paul, Venezuela. Uh, what what what did you what did you think of all that? >> Oh, I'm still trying to process all the thoughts that I have going with that. I wake up early that morning, you know, get up, have cup, I don't know, was 4:00, 4:30 in the morning, something like that. And I sit down, pull up, you know, X, and I'm like, what? What just happened? It was unbelievable. Yeah. I was I was com shocked is is the only word that I can come to right now and I'm still trying to process exactly how I feel about it. But I was shocked needless to say. >> Well, it it's I I fit it into a sort of a larger sweep of things, right? Which is um remember so Trump shortly after inauguration calls Canada the 51st state. And then very weirdly because I didn't see this wasn't on my radar screen at all. He's like Greenland. Maybe Greenland should be part of our sphere here. So what what's clearly Venezuela fits into this thing which is like oh kind of looks like the United States wants to operate hemispherically or at least regionally in the sense that like hey South America our backyard, Canada our northyard, our front yard, you know, Greenland kind of on our side more than your side, Denmark or whatever. just if it kind I think that's what we're looking at here is a is a um a sense of saying okay this is our this is our real core sphere of influence which I wouldn't mind I'm actually okay with that on a number of levels I differ in that I would prefer to approach all of those potential partners with deals and wins and with respect and you know finding ways to create win-win I understand that's not how the US has operated for a long time we prefer the gunboat over the checkbook. It's fine. Um, not mine to to say, but we did that. And then I was The only thing that really shocked me, Paul, is is what's happened since the statements coming out of the Trump administration. I don't know how to make sense of them, to be honest. I just don't >> I'm with you. That's one thing that has me just my wheels spinning just trying to figure out what's the real truth of what's taking place. Now, I will say this. Did Go ahead. Go ahead. No, I was just going to show you what what Trump tweeted this morning. >> Yeah, I'll save this for later. Um um but so go ahead. I want to see what he tweeted. >> All right, save that. Make sure make sure you keep that. Um Trump says, quote, "I'm pleased to announce that the interim authorities in Venezuela will be turning over between 30 and 50 million barrels of highquality sanctioned oil to the United States of America. This oil will be sold at its market price, and that money will be controlled by me." M. Wow. Wow. What's that supposed to mean, Chris? By him. >> What do you mean by me? That's That's not how this is supposed to work. >> Uh, is that some merger with True Social getting ready to take place? I'm not sure. >> I I I I don't I maybe it's just poor phrasing. you know, this is just Trump tweeting out, but I can't make sense of. So, that basically takes the gloves off and says, "Hey, we're going to take your oil here." Um, and to sort of cement that, we had the Department of Energy's secretary is Chris Wright, former CEO of a fracking company. Maybe he'll go back to that, but but comes out of the oil business and he's at a Goldman Sachs energy thing yesterday. And um let me know if you have any problems hearing this. >> Uh the president recently announced your role in executing the plan to turn over between 30 to 50 million barrels of sanctioned oil to the US. We learned about that as a as an investment community yesterday. What can you share about uh the recent announcement and talk about the plans to execute this? Yeah. So, look, I'm working directly in cooperation with the Venezuelans and we and we are going to this is this is the crude that's backed up and onshore storage and that's in offshore floating storage. We're just going to get that crude moving again and sell it just like we did in our businesses. We're going to market the crude coming out of Venezuela first, this backed up stored oil and then indefinitely going forward, we will sell the production that comes out of Venezuela into the marketplace. We will have US as the supplier of dilluent that's got to go down there to enable that production. We're going to have that flowing again. And as we make progress with the government, you know, we'll we'll enable the importing of parts and equipment and services to kind of prevent the industry from collapsing, stabilize the production, and then as quickly as possible, start to see it growing again, and of course, in the long run, create the conditions that the major American companies that were there before, maybe that weren't there before, but want to be there, will go in. The resources are immense. This should be a wealthy, prosperous, peaceful energy powerhouse. That's the plan. >> Okay. What did we just We just heard that we're going to seize all the oil that they've pumped over however long and we're going to sell it like as if they needed help. You don't need any help selling oil in the marketplace. You know what you need? Trafigura or or I mean just you just sell it. You just like any No, they don't need help selling it. And then he said, "We're going to we're going to be taking their production going forward and we'll sell it. Under what terms, under what sort of authority?" Like, "How much do we keep for our troubles versus give back to the Venezuelan people?" Like, it's all a little vague at this point in time, but um all we do know is that it's going to be controlled by Trump. >> Trump. >> So, >> and if you if you add what he said, he said indefinitely. >> Indefinitely. >> Indefinitely. Yeah, good catch. Indefinitely, which remember we temporarily closed the gold window in 1971. There's nothing quite so permanent as temporary, the federal government. But also, I think indefinite is even more permanent than that. It's like infinitely >> indefinite indefinitely means these resources are ours now and we're going to do with them what we want to do. Mhm. So that um whatever people feel about Mike makes right or foreign policy or any of that stuff, this is the most transparent and honest expression of that. The United States has basically said, "We're taking that. That's ours now." Um and again, that's going to have a chilling effect on potential trade partners, my guess, right? I would anticipate. So, I mean, I I I just it it just amazes me because, you know, I can't remember the exact scenario that we used before, but if I had a friend that was was doing business at the same bank as me and without the rule of law, this goes back to when we took the reserves from Russia, without the rule of law, his his or her bank account is seized, right? It, you know, indefinitely or temporarily or whatever, I'm leaving that bank. There's no way I'm going to leave my funds there, especially if they're not following the rule of law. So, how in the world do you do you do business in this manner unless you're going to kneel down and kiss the boot? And that's not mutually beneficial because what's going to happen is those in those other countries are going to look for their opportunity to strike us in our Achilles Hill when they get that opportunity. So, it just makes it a much more uh dangerous situation from a global perspective. >> China has made a lot of investments there. So, some of this is just kicking China out. But what I've read so far is that China's not happy about that. And and they're going to flex their muscles in a whole new way around this. They're not just going to sort of pout about this and maybe issue a couple harshly worded statements. They've said, "Wow, get welcome. Get ready for a lot of legal action because they have contracts and all of this." And and so they're about to just dial up and say, "If you want to break contracts, that's fine. But we have other contracts over here." and they've already taken steps to say if you're going to do that, if you're going to unilaterally just abregate those contracts that we have, then we're going to start taking these other steps, including cutting off rare earths again and doing other things that could really limit our ability to function well. >> And I thought that was interesting. I read a I read a thread on talking about how they were going to take legal action and just how important the outcome of that legal action is going to be for global business. And while you're looking at that, Chris, or looking forward that, I'll ask you this question. I had read somewhere, and I didn't save it because I didn't anticipate it needing it. Uh, it's I don't I have it saved. I just can't find it right now. Let's put it this way. So, there was a statement made that apparently Venezuela has a massive amount of of gold, not necessarily reserves, but a massive amount of gold in the ground that that is there to be mined. Have you heard that as well? >> Yes, I've heard that. I also heard that that it got potentially shipped out um right before the attack happened or the rescue operation or the or the stand aside operation. Whatever actually happened, I don't know. I'm out here in the cheap seats. All I know is whatever I read is usually not true. Um there's more more going on behind the scenes obviously than we could ever know. >> Mhm. This is popping up just as breaking news as we're recording this. Um, it's coming out of a German station here saying China is preparing to transfer missiles, air defense systems, and drones to Venezuela to escort Chinese oil tankers. So, they're basically saying we might be enforcing our own set of things. Who knows um what that really means. I can't trust can't really trust anything these days as we talked about already, [laughter] >> you know. Isn't it amazing? we have all this access to information and now with AI and all of the propaganda that's out there, I find myself every time I see something like that, it's like, okay, now I got to go down a rabbit trail to try to [clears throat] confirm it in several areas and it takes two to three time uh uh two to three times the amount of time that originally took to be able to look and find something. >> Yeah, >> you just have to go verify it. Um, one of the things I can add to this because I've studied the oil business intensively for the past few decades and I'm an investor in in oil and gas and all that stuff. Um, is that oil isn't oil isn't oil. I know a lot of people don't know a lot about the oil industry. It's always presented as if oil is a a single word. Like we we said cotton. It's kind of a thing, you know. Um, but if you're into cotton, you realize once you process it, you know, you could have Egyptian thousand thread count sheets or you could have like a, you know, a brillow pad equivalent, you know, sheet set from Walmart, whatever. You know, it's all different. So oil isn't oil isn't oil. We get in the United States, we're busy drilling shale oil, which is typically very, very light. It's almost gasoline. In fact, coming out of the Eagleford shale formation in South Texas, it might as well be gasoline coming out of the ground. Literally, some of that stuff can be put straight into an engine and it'll work, right? So, we have really light stuff. Venezuela has some flowing stuff um in the Marrabo fields over there on the western side, a little bit on the east, but most of it when they say 300 billion barrels of oil is this stuff. It literally looks like that. Uh it does not flow. It's tar. It's not just like the tar sands of Canada, that's that's formed out of a substance called bitammen. This is uh shot through with what's called asphaltines. It's basically road tar that is not quite fully dried yet as one person put it on Twitter recently. Um and it it's just hugely expensive to get it out of the ground and to process it. So you heard Chris Wright say, "We're going to supply the dilluent." What's that? That's your dilutive stuff. We get this stuff out of the eagle fur. It's practically gasoline. We now ship it to Venezuela and they pump it in the ground to sort of like loosen the stuff up so you can pump it out again and push it off towards a refinery. It's very expensive to get done. But what was left unsaid in that is this is a shot across the bow to Canada [snorts] who also supplies heavy bitamin laden oil that requires a lot of dilluent to turn it. uh they cut it so that it flows so you can put it in a pipeline or a tank or something and get it back out of the tank. This stuff, if you put it in the into a tank, you'd have to use a spatula on the way in and a shovel on the way out. You know, it's just it doesn't flow. So, it it's extraordinarily expensive to get this stuff to flow. And by the way, the DOE said, "Oh, you know, Chris Wright said, we're going to do all this stuff." They don't have none of this is in their budget. None of this, right? They don't have any money for this. So that's why he said, "Oh, we hope to create conditions where Exxon comes back in." If I'm Exxon, I'm just going to be squinting at this for a while because what if Trump loses the midterms? What if then you get a Democrat president who says, "I'm going to undo all of this stuff Trump just did, but you're halfway pouring $50 billion in." You're not going to do that. You're going to you're going to need to see some form of guaranteed stability for a while before you're going to invest that kind of money. I I this whole idea that that people like, "Oh, we get all this free oil now." It it's just it's not true. It's not how this works. >> That's a very good point because because I I don't know how politics are going to unfold, but I do know know that there is a tremendous amount of Trump supporters that are ridiculously frustrated with him and the Republicans and, you know, not not doing what they said they would do. So, that's a very good point, Chris. And if you're a major business, what does it matter to you if you wait 9 to 12 months or 24 months? >> Well, all the majors, they already have their capital budgets for next year are all decided already, right? They in order to spend money in Venezuela, they would have to pull it off of some other project. Those other projects have already been sifted through as the best of the best they have to prosecute. So, the Venezuelan stuff would have to slot in and be even better than that. So that's why they're going for the quick hit, which is of the stuff that Venezuela already pumped out of the ground, which belongs to Venezuela. It's theirs by every possible understanding of how the world works. And we've just said we're going to take those 30 to 50 million barrels. We'll take them. We'll sell them. And if we're feeling kind, we'll share some back with the Venezuelans. Right. But but this is this sort of the the idea that we've just seized a lot of oil that we can immediately prosecute is not true. If you seized Saudi Arabia, it would be true because that stuff's flowing out of the ground. It's a medium grade, medium heavy, sometimes light. It's good stuff. And you know, you can use it right away. The Venezuelan stuff is more complex. It's all I want to communicate. It's just it's this is a very complicated substance. And by the way, to get even more wonky, it's shot through with sulfur, heavy metals, all kinds of stuff. We can process it, but you kind of have to um do that. And it it typically has to go into a cracking process which is 500° C with hydrogen very it's expensive. I don't at today's price even if Exxon said we have unfettered access to this for the next 10 years at 58 a barrel which is current price today it's not worth it. I think this has to be oil prices have to be 75 to 90 before you would say okay. So it this whole idea that we just took a lot of oil and it's going to make gas cheap next year is just not correct. >> It looks like peanut butter. Is that a good explanation of the consistency of it? >> Yep. And the equivalent analogy would be uh trying to get that stuff to flow through a pipeline would be the same as putting a scoop of peanut butter on the roof of your dog's mouth. [laughter] >> Have you ever seen that? >> That is great. That's a good good visual picture. >> Well, it's a big deal from a long-term standpoint. I mean, it it it really e either way, I mean, there's so many ramifications of this behavior. And what concerns me is is, you know, we just continue to cross lines, right? We just continue to cross lines. You can justify it however you want, but we're continuing to cross lines that that we did not cross before. our our morality and our integrity kept us from from crossing, but that doesn't seem to be a restraint anymore. >> No, that that those gloves got taken off. That's really what happened here. And I'm I'm worried because again, it's both the appearance, if not the fact of the rule of law that gives our capital markets their advantage. And it's only a hop, skip, and a jump to say, well, if you don't respect international law, which by the way is kind of somebody put it on Twitter. They did it a great job. They said, hey, you want to hear a joke? International law. Um, [laughter] it's it's not really a thing. It's been everybody ignores it. We pretend like it's something when it's convenient, but otherwise we ignore it. But but still there there is the the sense of saying wow to trample some other country's sovereignity and then blatantly say your stuff belongs to us now. Hey that's happened through empires all through history. But it's a hop skip and a jump to go from that to say but are you going to treat my sovereign reserves or or my personal accounts as a foreigner in your capital markets? How safe are those? It's a fair question and I don't think you get to erode that trust [snorts] too many times before people go I'll take I'm just going home take my chips. >> That's right. And if you're another country, we did it to Russia. We justified doing it to Russia with their nuclear capabilities. So what what are you thinking if you're a smaller country? Who are you leaning towards right now? Are you leaning towards the east and the bricks where where you know I haven't heard them crossing these lines at this point. they seem to be building an infrastructure through the unit that has checks and balances in there for that accountability, especially if they're backing it by 40% with gold and then a country's natural resources and their economic output. So, um, alternatives are emerging and that's the first time we've seen in a long time alternatives to the US position of power as a global reserve currency. and and and I've heard those that have argued, hey, this just reliqufified uh the dollar is the global reserve currency when they took over Venezuela. I don't know if that's actually what happened from that standpoint or not, but the fact that somebody's talking about that just tells us how weak of a position from a trusting standpoint that the dollar has become on a global basis. I don't know that you would have heard anybody talking about that 20 years ago, 25 years ago. >> No, probably not. But 25 years ago, we had a trillion in debt rather than 38. Um, and so I've heard numbers bandied about like, oh, there's 17 trillion in assets in Venezuela. There are like, well, that's like literally less than half the current US deficit of debt level, right? Our deficit is still over $2 trillion a year. Um, and so, but the the reality I want to point out is that, yeah, you know what, we squatted in Syria, the United States did, and we took a lot of their oil. Um, but that's in the desert. Trying to defend a jungle environment. Totally different, right? Deserts are kind of easy to defend because you can see people coming from literally dozens of miles away and makes it trickier. Jungles are just different, right? Um, and it's a tougher environment to operate in. And that Oruronokco belt that where all that stuff is is about 8,000 square kilometers. It's a giant region. So, how many boots on the ground is that in the jungle? I don't know. It's a very big number. So if we're willing to commit that, my point is that 17 trillion, Paul, isn't like a chest of gold you just go and pick up, take home. You got to go there. You got to extract it. That's hard. People, locals may get cranky about that over time. That makes it more expensive. Um, and so anyway, I I've seen a lot of like crazy stuff floating around. It's like, woohoo, you know, we just 17 trillion. I'm like, might be more complicated. Let's see how this plays out. >> Well, that's well said. and and when people read those short headlines, they don't think as deeply as you do about the the long-term picture from that standpoint. So, I'm glad you pointed that out. >> Well, can um as we close out today? Well, we got a couple more things. Did you see margin? >> Yes, I did. I I've been amazed by that actually. I really have been like there's no restraint right now. It looks like investors are it's going vertical and it looks like in investors or those that are willing to to leverage themselves to the hilt >> are uber bullish right now with that move and and I just don't understand that. That's speculation. That's not investing. >> Well, do you think there's a chance it's it's related to the idea that the Federal Reserve has been like slowly tightening and winding down its balance sheet for a number of years now and is suddenly U-turned and is back to printing money. By the way, this isn't QE. Not QE. Totally not QE according to the Fed. It's not. This is reserve balance management. [laughter] >> I can't wait to I wish I would live a hundred years to look at the history books and see see how they phrase all of the different names they've had for QE. >> But um >> money protection. >> Yeah. Well, and it makes sense, Chris, if if they're going back to expanding the balance sheet and back to printing under whatever whatever name they want to call it or term they want to utilize it. It's a reflexive uh response like Pavlov's dog from your big institutions that have been utilizing leverage, especially the ones that appear to be too big to fail. Why not? I mean, if you're in a situation where you think the government's going to completely requefy, destroy the bond market over the long term, >> let inflation re out of control, then why not lever yourself to the hilt? That's not something that that I believe people should do individually because the risk is just way too high if they don't pull this off. But if you're a big institution or a hedge fund playing with somebody else's money >> and and you're two and 20, you're getting 2% plus 20% of whatever the gains are and you have nothing to lose if you blow up, you're losing client money, you've got everything to gain by that risk. Why not lever to the hilt? And you know that's one of the reasons we never set up as a hedge fund uh structure and compensations because the risk of carrying you know the temptation to pull all of that extra risk [snorts] in there you you know maybe that's the reason why I mean if you go back to 2012 2013 you were concerned about printing and what that was going to do in the interim period hindsight especially all of these models because mo most of your computer trading algorithms are based off of historical performance really for most of it that I've seen. I don't know this for a fact, but since 197374, then of course it's going to tell you to lever yourself to the hilt right now because they're going to reflate uh reflate the markets and the reflation trade is on. And they're probably more confident right now than they've ever been because they're looking in the rearview mirror without realizing that worked during a period of time when inflation didn't get out of control. We were still recovering from all the deflationary forces that occurred from 2007, but that's a completely different environment for where we are right now. >> Well, it it it is and um but you're right. Uh every single time the Fed has started the money spigots opening up, the go-to thing just buy risk assets by just just do it. So, we could be that the margin debt is just people saying, "Hey, I see the Fed's expanding its balance sheet. That is it's managing reserve balances. It's printing money." And every time that's happened in the past, pile in. In fact, pile in with leverage, right? Make sense? >> It makes sense. But I I there must be something more to this cuz Okay, Germany is in total economic basket case right now, right? It's in terrible shape. >> It's just awful, right? Collapsing energyintensive industries is just stagnant. It's just terrible. But but against that, well, the the the DA the DAX is making new all-time highs here. >> Same story, right? Are people piling into German risk assets because it looks like a great time, you know, to to own German risk assets. I don't know. I'm just It seems to be a global thing. The Nikkay's at all-time highs. The Dow just punched into one. The DAX. So clearly, there's this huge amount of money flooding in to that whole story. And then we see that the Federal Reserve is like, well, against that backdrop, you know what the most important thing here is that we do. [laughter] >> We better print. >> Exactly. [laughter] >> No, but this is annoying to me. In fact, it's infuriating because I just spent over the holidays with my kids, right? And um my eldest is 30, my youngest is 24 now and 25. and uh and they all say they have no hope of buying a house unless somebody helps them, right? That and all their friend groups are feeling the same way. Nobody they know is having kids or starting households really, right? It's it's like way on the back burner. And that's because somebody keeps printing money to bail out the rich people so that they don't experience even a slight decline >> and they're throwing the next generations completely under the bus. And it's by policy. It's not an accident. It's a policy. and it's destroying, damaging the next generations. And I I I can't be more contemptuous of that approach. I think it's not even shortsighted. I think it's evil to be honest. >> No. Oh, I agree completely that it's evil. And if anybody out there is wondering whether there is a good or evil, that is just absolutely one blaring um siren that yes, evil does exist because it wants to to harm others for your own benefit. And that's what the the the wealthy are doing. Harm others. It's not mutually beneficial. This isn't taking care of the next generation. And then I I've said this before. The Bible says, you know, if you read it at the surface, you know, a good man leaves an inheritance to his children's children. Well, in the United States, we've been taught the prosperity gospel for so long, and I know I've said this before for those of you that have heard it, but it's worth saying again. It's more than money. It's it's it's a good name that you pass down to your children. It's it's a good example that you set for them and the generations around that opens more doors for them sometimes than just dollars can open and and if you're you know if you're laying a foundation for the next generation that they can be better than you and and and they can catapult beyond you. It seems like this is the first cycle or generation throughout history that really doesn't want their children and grandchildren to do better than them. And that that seems to be a narcissistic, you know, decision. Hey, I'll give you a bunch of money so you can remember me and your future is going to be because of me instead of and I'm not talking about family side. I'm talking about on the nation side. Hey, we're we're we're making a few sacrifices for ourselves now and we're going to go through some pain in the interim period so that you can have a better foundation so that you can better your future. That's not what we're doing. We're not we're not setting up an environment to where an inheritance goes to its children. So the opposite side of that is what you would assume that an evil uh individual, you know, leaves absolutely nothing but stones stacked against them. I mean, how much harder is it for a kid that grows up in a community where their their parents and grandparents had a horrible reputation for not being trustworthy, for not paying their bills, for not keeping their word. So what happens like I know a young man right like that in our community that is completely changing from what his family line is but it's so much harder for him because we observe right are you different and and and that's a stark comparison to what good versus evil would be. Evil's all about me at the expense of somebody else. good overflows into the lives of the community and those that are around them and especially in their children. And it's just heartbreaking to me. It really is. Evil is the perfect term for it. Chris, >> I completely agree. And um there's also this idea that things are changing too rapidly for people to or cultures or communities or individuals to to really adapt at this point in time. It's too fast, right? Like what's happening with AI? It's too too fast, right? And um what's happening in geopolitics is just too fast. And and so this is this is the time when I think you have to you have to be prudent. You have to be aware, you know, you have to know where the puck is going to be harder than ever because it's full of AI slop out there right now. Um and it's just it's hard to tell what to trust. I've seen everybody from the president, Elon, all these conservative influencers, all accidentally or intentionally retweeting and sharing um fake stuff and presenting it as real. And that really begins to break stuff down, right? When you can't even trust what you're seeing, you know, >> creates a tough environment. It really does. So, I actually think the wave of the future is going to be people ditching their smartphones. Getting away from all that, going, you know, you live out in the country, I live out in the country. We both got farms. People are going to want to get dirt back under their fingernails. We're going to want to swing hammers, maybe get sore thumbs, you know, learn from physics again, right? It's going to be I I think I think there could be a a bright side on the back of this. But first, we have to understand just how toxic it is for us to outsource our decisions, our morality, our conclusions, our thinking to anybody else, let alone a machine, >> right? Yeah. Let alone a machine that has learned off of human nature and the weakness that we have in our human nature. >> Right. On that on that front very quickly, um I know we we got to close up here, but did you see this tweet from David Shapiro? He wrote, quote, "You guys realize that all software is about to be free, right? And software presently is the most valuable capital asset, right guys?" And Elon said pretty much. >> Yeah, I did see that. But what does he mean? Do you know what he means by that? So what what he means is um Nick was just telling me about a friend of his, leave him unnamed, uh who knows nothing really about coding and technology, but was using cloud claude plus a couple others and coded up an entire tech stack to to perform a function like you can you can write your own software now. You can >> wow, >> it's really not hard. You just sort of tell it what you want it to do and it does that. Um and and so I only thought about that because this I thought should be on your radar screen. Um you know we see that like you know Linux is free, Docker's free, GitHub, Git, um Python, all these things are free and so now that average people can start writing their own software. Um did you see this big rotation out of software uh recently and into semis? >> Yes. So the semis would be the play. If this is if that thesis is true, it would look like this. I'm not saying this is exactly what's happening, but the software companies are going down, but the way you operate the software, which is those top ones, are going up. Two dots make a straight line. So I'm not sure if we have enough data, but you know, you know, you know what's interesting? Before I saw that tweet, I was just cruising and perusing sectors and sector performance in comparison to other and looking through our tools and this big red flag came up in a lot of your software producers. I'm like, why is that price action taking place the way it is? And then I see that tweet and I'm like, okay, there you somebody in the market knows something and you're starting to see softness in the in the software. So, I'm glad you really pointed that out because I had already seen the action, but just didn't put two and two together because I wasn't I did not realize that it was that easy to code with AI. I mean, I I had heard that it was, but I didn't know the average person could build a code like that. Well, and and editorially, I guarantee you there's a million kids going into debt in college to become computer science engineers because the colleges haven't figured out because they're not rapid adjusters that the whole world is shifted out from under them and they're just turning the crank and teaching kids, you know, software coding when that's not it's already dead. It's it's already over. >> Yeah. Right. >> Well, I mean, they're they're a they're a a self-interested extraction machine from the younger generation is what they are. even if they recognize it, you've got all these professors and individuals that have positions of power that are going to refuse to make an adaptation because they're close enough to retirement [snorts] >> and uh you know, unfortunately, you know, they move way too slow because of their own benefit. >> Yep. Indeed. So, uh tricky environment. How how do you how do you navigate this as a as a manager of portfolios? I'm glad you asked that question because I was thinking about this conversation I had with someone yesterday that they just asked me in a a a very interesting question in a different manner. I get it asked a lot of the times and they said hey you know we want to know as an introductory call we want to know kind of what your philosophy is if we're on the same page said you know we do not believe the environment that we're in is unsust is sustainable but we can't develop a picture of what the future's actually going to look like and where the opportunities are. So they're like how do you deal with that and I'm like well you deal with it by being adaptable and you have to have a mindset. Now, we're fortunate because of the individuals that that built the basis of our strategy had to navigate the 1970s and the 1980s. So, they had massive change from the inflation of the 70s to the outsourcing of the '9s and massive adaptation. Well, in the mid1 1990s when Vanguard and Fidelity kind of came on and started pushing the passive investing, that adaptability is gone. Okay? and government actions have further driven money into that passive the US is the only place to be and overweighted. Now hindsight we can look in the review mirror all of those forces Mike Greens talked about how it's distorted and it has made the passive investing in the US markets really the only game in town especially since 200 uh [clears throat] uh January 1st 2008. All the [snorts] major indexes are are flat. So, how do we deal with that? One, you have to be open-minded from the standpoint that investments are tools. Okay? And this is the best analogy that I can give. If you're a really good mechanic, you've got a massive amount of money that's put into your toolbox. Okay? And I I I stole this analogy from from a a client that is a mechanic that was telling me about one tool he had. It was like a $5,000 tool, but he only used it once a year. and he said, "That thing's paid for itself time and time and time again because when I need that tool, it is the most valuable tool that I have in the toolbox." So remember, investments, Wall Street's going to tell you, be passive, okay? Just just be passive. In other words, trust us. We'll make sure that you're going to be okay while while everything's going not taking into consideration the forces that have have benefited passive, which are going to go in another direction at some point in the future. Mike Green's done a good job of explaining that. So uh so from our standpoint, you watch money flow, you have tools, you have all these things that you're following and you make adaptations. I won't have one asset class outside of an immoral asset class, right? There there are certain that are just absolutely immoral that that I I won't touch and clients don't want to touch them. But [snorts] gold, for example, Wall Street doesn't want to touch it. But since it since we got a buy signal back in 2016, that's been one of the single best tools that you could use in your portfolio to help protect your purchasing power from this inflationary pressures that come along. Silver, some of those others. There's going to be a time in the future where maybe a foreign currency, I mean, we've only used foreign currency in our main strategy for nine months since 2004, but during that nine-month period of time, it was the single most valuable tool that we had in our arsenal. So, so that adaptability and having a strategy that helps keep those emotions in check because here, look, I've done this for 28 years. I still feel the emotions when you have a big shift. When we sold some asset classes before, it's very popular out there. That's a scary thing to do because you don't want to be wrong with your clients. But when you have a strategy that tells you the opportunity is elsewhere, you place that tool back in the toolbox and you pull the other one out to help you implement. So another analogy that I I can utilize from that is we want to run a marathon with a relay marathon because instead of just one asset that's going to use us all the way from that period, there are in hindsight and there will be some assets that are perfect to sit on the shelf for 20 or 30 years. But in a a period of time where you have this massive change that's taking place globally, you've got markets that are US markets specifically that are ridiculously overvalued. You got to have a strategy that's going to tell you when to exit a particular strategy. Understand it's not going to be perfect in timing. But you've got tools that can increase your probability of success of being in the right place when that shift takes place. and also have tools that'll tell you you might be there for 12 or 15 months, but you got to go back to where you were before. So that adaptability, I believe, is going to be unbelievably important over the next 10 to 15 years because when we look in hindsight, you can see all the strengths of passive investing. Most investors look in hindsight and they try to project that into the future. It's called a hindsight bias. You know, if things have been really bad for you for the past three years in your life, you assume you have a natural tendency to assume they're going to be really bad for the next three years. If they've been really good, you assume that they're going to be really good for the next three years. So that adaptability is very important. It takes courage. It takes discipline and it takes putting your emotions, the greed, the fear and everything in check and navigate through that environment. And you know, and in reality, dance as best you can through the streets while Rome Rome's burning to the ground. I mean, you're still going to fear those emotions, but the resources that you have accumulated through over your throughout your life to be a prudent prudent management and responsible with those uh is very important. So, it's adaptability. is the willingness to go outside your comfort zone for asset classes that w that Wall Street and their what is it they call it your uh somebody had a perfect term you know your financial porn media that's a horrible term but it does a good job about just explaining how it's telling you what you want to hear seeking information that is not necessarily what you want to hear but what you need to hear and pursuing wisdom so that's that's how we do it is having that adaptability From 2004 until 2012, our portfolios were a completely different allocation than what they've been since 2012 up until here recently. Really heavy commodities, really heavy international during that period of time while the US markets were struggling. Those assets were outperforming and then uh over the past 10 years really outside of the past two when commodities kind of came in there, you really overweight US equities. So we have to be adaptable. There's an equalization taking place within the world. The east is rising and the west is kind of dropping. There's going to be massive opportunities there. So I have to tell clients from time to time, you know, set those emotions down. Take all of the perceptions that you've had over the past 20 or 30 years and understand you've got to make as prudent, adaptable decisions with your funds as you can. You can't time the market perfectly, but you can maneuver in a position when that big ball of money starts moving around the world because the reason it's so important to me in money flow and that shows, you know, from a technical standpoint and price action, the big institutions know more than we do. Okay? So when they start moving, we can look back in hindsight and see, you know, central banks were moving into gold heavily starting around 2016 after selling everything they had coming into early 2000s. They know where things are going. And if we're paying attention to that, not just being sold some product or told what we want to hear, then we can make those adaptations and pull those tools out of the toolbox and implement them in the portfolio until it's time to use another tool. So, so that's that's how we do it. The most simple explanation that I can give in the term of analogy is the adaptability and be curious. Be curious, courageous, and love the truth more than anything else because there's going to be perceptions. There may be a time, you know, when we use currencies over that period of time. We had the Canadian dollar in there because it was resourceheavy. We had the Australian dollar in there and we had the euro. Now, the euro made a lot of people feel uncomfortable until it did really good over that period of time. And then by the time it felt good, our tools were telling us to go somewhere else. So that discipline and the love of truth because if we love the truth more than we love what we want to hear, then you're going to drop the veil of your perceptions and be able to see the future clear more clearly. So that's that's the basis of everything that we do for clients really is just be adaptive, love the truth, be disciplined and courageous. >> Very good investment. You know, you know this, Chris, no good investment takes courage. It's easy to go buy Nvidia right now when when everybody's talking about how it's going to get you rich. It was really hard to buy Nvidia when you know after it had had some major declines in the past. So, so typically the investments that that make you the most uncomfortable to purchase. I mean, how uncomfortable was it compared to cocktail parties to be to tell people you were overweight precious metals at some point in the past, you know, 15, 20 years. They look at you like you got horns coming out of your head. That's that courage and love of truth and the love of what the numbers and reality tells you. That love of truth will keep you from believing the propaganda and the narratives and help you manage your funds more more prudently and wisely. I said prudent like 5,000 times, guys. Sorry. >> Well, it's important word. I mean, you got to know when to hold them and you got to know when to fold them, right? There's an exit and an entry to everything. And so, first time in my uh in decades I'm having honest question, honest discussions about what is an appropriate exit strategy for silver, right? There will be one at some point in time. I'm not there yet, but I'm starting to have the conversation. It wasn't even on my radar to have that conversation. And but now I can begin to imagine that I'm going to have to have pre-thought that through because as we mentioned before, the hardest time to sell my silver is going to be when everybody wants it. And you'd be a fool to let go of a single ounce. That's going to be hard, but that's why you got to I have to have a plan, not emotions about this. And um it's just yeah, it's the way of the world. >> That's right. And and sometimes it's going to be easy. You know, if you go back to when did gold uh peak in 1982, I think it was 81 or 82. Was it earlier than that? >> It was 88. Yeah. January. Yeah. Somewhere in that zone. >> Yeah. Somewhere in my archives I have the chart, but but at that time the value of gold outstanding was worth 125% of the US of the dollars in circulation. So, it had become overvalued. There's going to be a time in the future where it's going to be clear in hindsight that we should have sold silver or gold at that point, but you've got to be looking for those. And there will be signs. One's going to be every retail person in the world and every taxi driver that you run into or Uber drivers going to be talking about how great silver has been and and and picturing this future. That's going to be one sign. The second thing is is understanding I'm not going to pick the top. I just need to get close. Okay? I'm not gonna pick the top. And and and if you've done it right, you're still going to leave a little bit there or you're going to capture on the other side of it. You're only going to know in hindsight. But that's why strategy is important. That's why diversification is important. And um and that's what we help people do is help navigate for those that don't enjoy doing it themselves because if you don't enjoy it, you're not going to do the research that you need to do to be prudent and effective for you. So those are the first people that we do this for. The second people that we do this for is recognize that they don't like doing it and they don't want that responsibility but they can't find somebody that they can trust that can articulate and communic uh clearly communicate why they'll sell while the why they'll buy and how they'll make adaptations because most of the people that I'm running into just don't you know the passive thing at this point in the cycle just doesn't make sense to them. It just doesn't make sense. And and quite frankly, there are very few people out there that are doing anything besides passive cookie cutter modern portfolio theory approach. We are a rare breed now. And I did not realize how rare until the past two two and a half years. Most of your industry is is really predicated on the rearview mirror. Hey, let me tell you what's worked for the past 20 years. leaving I we you and I could make a case for maybe additional caution just based on the how expensive the markets are just on that one feature. We could probably make an equally strong argument just on how disruptive AI is likely to be that the past is not likely to be a good guide for the future. We're going to have to be really thoughtful. We're going to have to take our best guesses and we're going to have to adjust quickly when we get it wrong because it's moving too fast. Right? So, but everybody's sort of glued to the past. Um, by definition, you're making the wrong choices when when things change, right? You know, it's like driving driving in the rearview mirror is fine when you're in Kansas. It doesn't work so good in Colorado, you know. Um, >> no. No. And and and another analogy, if you have no sales strategy, you have no nothing that's going to cause you to lower risk in that portfolio. Not only are you driving in the rearview mirror, you have no brakes on the car, right? You have no brakes on the car. And and everybody understands that, yeah, you can run a red light and have no consequences happen. You might not get t-boned by a transfer truck and you might not get pulled over by a cop and and but you but if you're driving from here to California and running every red light and stop sign you come through, it's highly unlikely that you're going to end up there without a catastrophic event. But that's what Wall Street does and that's what we've come to in the modern investment world is it doesn't matter if there's three nukes in the air. They're not going to sell. And if they do sell, it's an emotional decision because they don't have a strategy to tell them when to sell. And if they don't have a strategy that tells them when to sell, they certainly don't have a strategy that tells them when to buy. So the only thing that they're relying on is passively leave it there. Let's stick our fingers in our ears and close our eyes and let's hope it works out. Or emotions take over. And guess what they do? They sell everything at the bottom of the market in 2009 after going all in the market at the top of the market in 2007. That's that's what our emotions do to us. And guys, I'm telling you, it's my 28th year doing this. I've seen every mistake that people can make because most of them have come in and tried to help us help them recover from those. Okay. So, so you know, you get a little cynical. I remember when I first started in the career, I looked at all the the older, wiser guys that I went and learned from and I wanted to seek them out and I was like, why are these guys so cynical and they've been in the game long enough to understand >> y >> that, you know, you can be oblivious and it's really fun until you get hit in the mouth with a baseball bat. And and just looking back since the year 2000, 47% decline in the market when the a technology bubble burst. 2008, housing blew up. Well, the stock market wasn't that overvalued at the time, but you look at where we are. We're a combination of the 2000 uh technology bubble in valuations, a market bubble in valuations, and housing is overpriced at this point. And the demographics are not in the favor of housing over the next 15 to 20 years. So, we got here from a completely different launching point. And I don't understand why people outside of looking in the rearview mirror and Wall Street's desire just to tell people what they want to hear, we're at a completely different starting launching point now and is going to be much much harder to to repeat the same thing over the next 10 to 15 years. It might continue for another year or two. I could build the argument that that this market's going to have a blowoff top in 2026. And I'm watching, you know, us struggling at resistance. If we break out, maybe it carries another three months. Maybe it carries another six months. Maybe this administration kicks this can down the road into the midterms because they think that's going to help them. But but the next 10 years, I can just about with certainty say you're going to look back 10 years from now and you're going to see these other opportunities of what you should have done. And what gives us peace is we've got tools that will tell us when we need to make those adaptations. So that's how we kind of help help people navigate through it and and build them information, knowledge, and help them understand through our planning process what they can control, what they can't. And that brings peace of mind knowing that it's adaptive, their plan is prudent, and that they've taken into consideration all the things that can go wrong and you've built checks and balances in place to mitigate those risks before you walk into that journey. That's what wisdom is. And for anybody who wants to u maybe speak with Paul after hearing that and or his team, please go to peakfinaniallinvesting.com. There's a very simple form you fill out there and within 48 business hours after receiving the that filled out form, somebody from Paul's office will contact you, arrange the first of what should be three separate meetings and an introductory phone call and then a planning meeting and then finally, if it goes to that part, recommendations. And so that's the process. And that's even before anybody's agreed to work with anybody. It's it's part of the process and and the value [music] that Paul offers to the world. So Paul, thank you so much for doing that. Thanks for your time today. Happy New Year. >> It's my honor. Happy New Year to you too as well, Chris. For all the listeners and your family, may 2026 be full of wisdom and blessing [music] and peace for all of you. >> Bye for now, everyone.
Volatility In Markets: Friend Or Foe For Your Portfolio?
Summary
Transcript
Nothing in this program should be considered investment advice. It is for educational purposes only. Please hit pause and read this disclaimer in full. Look, there's a lot of people that have been stacking silver and gold that are really giddy about the prices right now, and I am too, okay? I love the long-term fundamentals, but I'm trying to prep everybody that there's more than likely going to be some gut-riching declines that are going to occur as this process unfolds, just like you're showing there. Hello everyone and welcome to this episode of Finance U. Happy New Year. It is now 2026. Paul and I have been off for a couple of weeks doing the holiday things with family and all of that. So Paul, welcome back to the show. Good to see you. Happy New Year. And um >> happy new year to you as as well, Chris. It's nice to see you again. >> Last we heard you were settling into being a grandfather for the first time. How's that going? Oh, that was phenomenal. Like the best Christmas ever. And u I'll tell the quick sto short short story about being a grandfather. You know, I'm holding my granddaughter and fed her. She has her, you know, bow movement and I hold it up and say, "Okay, grandfather's last line of defense. So, which one of you is going to change the diaper?" [laughter] So, it was great. I got all the joys of feeding, holding. It was wonderful. It really was. And just fellowship around the family. So, it was it was it was great. >> Well, that's wonderful. And and let's carry that glow into this conversation, everybody. We're going to be talking about um gold and silver, obviously. Uh and we have to talk about what's happening in Japan because we've had a thread, Paul, about that. And it's more is happening there. And we're going to talk about a little bit about what happened in Venezuela. I want to talk about the oil realities around that. And then there's a few other things we should talk about like the Fed expanding its balance sheet. And that's fancy way of saying printing money. So, hey, brand new year or is it where are we at? Um, and we said this back on October 3rd. Actually, we've been talking about this all last year, but when we said this, you know, gold and silver are screaming, are you listening on October 3rd? I put up this chart, right? And it showed gold at $4,08 with that nice little Leslie Nielsen um meme there. Nothing to see here. >> That's great. Yeah, and we saw the same thing. Silver, we said just on the cusp of breaking out of it. It's a long-term former high cup and handle 4854. Now it's closer to 80ish. And I say 80ish, Paul, because this is last night all day. Well, all day yesterday, oops, let me come over here. We saw the gold, the silver was just, you know, rallying all the way through right up into the close here at 4:00. And then there's this mysterious little mesa. What I don't know what chart pattern you call that. It just couldn't go up or down. And then boom, it just This is Well, let me look at this more closely. This is what that looked like. This is where I call shenanigans. That is totally unnatural market behavior right there. They capped it. Whoever they is, they capped its price and then they pulled the rug. And this is what they do. And by the way, they had just done this same trading pattern back on January 2nd when they were defending the 7450 mark. You can see it right here. Same thing. They pulled it and then what happened afterwards was this big decline down to about 7180. And I like how Steve alarm put it. He said, "No signs of capping the silver market silver price so far this morning. I'll keep you updated if I spot anything suspicious. [laughter] >> That's great. [clears throat] Sarcasm helps. [laughter] So let let's look at those shenanigans because it is shenanigans and I think it's important to discuss because the world is catching on Paul and these are the things that destroy markets because people start to go and by people I mean international trading partners start to go wow I can't trust you guys this you have fraudulent manipulated markets and that's just pure evidence to me of fraud and manipulation. So, Peter Spina of um or Spinum, I don't know how to pronounce that, Goldseek has wrote here a 1h hour silver spot price chart to show the price smash last night in two phases. The first wave was 30 million digital ounces in 15 minutes. And the second was about 20 million paper ounces traded over a second 15-minute window um with a little bit less of a price drop. But that's 6% of global world global world global annual silver world mine output in just two little dumps. Um, and that's just how that goes. Uh, so we're seeing the same old same old. But Paul, very hard to find silver right now um for sale even in the US, but I hear in Singapore, Dubai, China, it's like really in short supply right now and much more expensive than what you see here in the US. So that's that's not a market anymore as far as I can tell. >> No, that's not a market. Well, and that's not a market. And what people need to understand is traders have somebody that they've got to answer to. And if you're a trader and you're you're ex you're selling that much at once and you're driving the price down on your selling, that's that's not normal. I mean, no no trader is going to keep their job if they're doing that. So that's the one thing that I know about the trading markets that this is not fiduciary management. This is something else besides somebody deciding they want to sell everything at 3:00 in the morning when nobody's there because you want to maximize your price when you're offloading if it's for profits [snorts] and you're going to you're going to have a program trade that's going to take that out over a period of time. What we're seeing here is yeah, it gets consolidation. Maybe they're starting the consolidation and all of a sudden they're slamming that price down and there's lots of money being now if they're shorting it that's one thing. They may be making money on that side but that's just absolutely ridiculous. uh uh behavior. No institution is going to keep a trader who's operating that way. We don't see it in stocks in general operate like that. >> Well, it's it's it's not price discovery, right? It's price setting, right? If you want the price to go lower, you wait for a thin market and then you dump an overwhelming amount of sell orders into that little tiny moment and you set the price lower. That's that's all. But but it's it's it's it's this little telltale totally unnatural messa formation where like nothing like you can just like that sends the bat signal out to every computer algorithm out there warning we're about to execute a sell program. You never see that before buying, right? It's just that they cap it and they said that's enough fine. It's going the other way. Um but I think they're losing control of that. They've done this several times over the past few weeks. There was a period of time between basically Christmas and January 3rd where China was offline for four days and the the raccoons came out and they did everything they could including that January 2nd hold and smash everything they could to drive it down. And when we woke up on January 4th when China's art markets opened again, silver there was $89 an ounce and we were at 72. Uh, so obviously we climbed all the way up to 82 because you have to get closer and then we smashed it back down. There's currently about a $9 gap between what silver is allegedly being priced at on the US comics and what physical silver costs if you want to buy it in Shanghai and Paul that shouldn't exist. And here's why. If you're in the business and you can actually buy a million ounces of silver today off of comx and you sell forward so for a month from now in the Shanghai futures exchange a million ounces you can make $9 an ounce you're going to make $9 million less insurance transport and some other fees right but let's say you you're going to clear $8 million bucks for about 20 minutes of work >> in a functioning market that doesn't exist. That's called arbitrage, but it shouldn't exist. So, but it does exist. Tells me the markets are kind of broken right now. >> That's right. It is. The only other thing that I can think of now there are export controls out of China on uh silver coming back to the US now. Correct. >> Right. >> So, if I'm there are, but I don't know if they've been exercised or not, but it has to go up the chain of command now. You can't just decide to export silver as a as one of the silver exporters. Okay. >> You have to get you have to get permission. I I don't know what levels of permission have been granted or withheld. [clears throat] >> But that's that's pretty amazing that there's that big of a spread over there. They're closer to true price discovery obviously than what we have here. >> Well, it it just tells me that those million ounces, you can't get your hands on them in the US. So, this is the ultimate in a fake market. I've been talking about this for years. Here's the fake market. They set the silver price in the futures and they say, "Oh, it's $72 an ounce now." [snorts] But you just can't get any at that price. That's not how markets work, right? A market is where if if there's none available at that price, the price rises until some becomes available. That's how it would work. There's a price at which somebody will start selling their silver again. The fact that there's no silver available at 72 is people saying, "That's not my price. It's not a market." >> That's right. >> It's not a market. >> That's not an honest market, for sure. So that's not a market. And if the market's not honest, it's not a market. >> Well, this is a problem because I I personally, Paul, I consider that um at least half of the United States's relative financial strength is because we have the deepest, most liquid financial markets. And even though silver is this little tiny little thing, it's now telegraphing to the rest of the world, these aren't markets you can trust. They're markets, you know, put quotes around them. But if we ruin that, we're going to be really sorry if if people leave our capital markets and say, "We can't trust you. You know, we're gonna we're going to deal with China, Singapore, Dubai, anybody, because we can't trust your markets." That's whoever is doing this, I think, is exceedingly shortsighted. In fact, I think they're damaging the country. And I wish we had some sort of effective oversight and regulation or even prison time cuz I think willingly knowingly damaging the country is um should be frowned upon if not punished >> and the long-term consequences are severe. So the one thing that's made the US the light in the world especially economically uh throughout history you know many things but one of the things is the rule of law. So you had the rule of law and there were consequences uh through the judicial system if you got outside of that rule of law, right? And we've respected that for quite some time. So that was a benefit. If you're a dictator, authoritarian in another country, you do whatever you want to do. There is no rule of law. You're controlling the court. So in the United States, that made us a shining beacon over that period of time. But the rule of law doesn't seem to matter anymore. We've seen it with rules for thee but not for me with the with the ultra rich being above the law and been able to work their way through the courts. So that that's that's just another sign of this fourth turning and this change that's coming to place and the consequences of weak men and women in the halls of power. Agreed. So let me carry on with this silver story real quick. Uh it's getting exceedingly volatile now. So, I don't know if you can see down here, but but these are whole like this is these are like five, six, $7 bars up here. It's getting really volatile there and choppy. Two ways to interpret that. Some people say, "Oh, volatility happens at the top and it, you know, then then the decline maybe." But Peter Spina again saying, I'm going to say Spino looks like a spino. Welcome volatility. The daily silver price moves are quite extreme, unlikely to come down anytime soon. And this is where one way to interpret this because we've heard about um the dollar deleveraging the people walking away from the dollar, the debasement trade. There's all this ways we could talk about it. Um but I just want to put this up again because I think this is important. We put it up once a while ago. This is the gold price in Weimar Marks starting here in 1914 during the famous Weimar hyperinflation when their when their currency got completely destroyed beyond debaseed. And what's interesting is you see here the gold price and it just you know if you just saw that rise you'd say oh yeah I would have ridden that wave but would you have because now we're looking at the percentage change in gold price on a monthly basis and right here oh my gosh this is down this I put this bar down this that's a minus 25% decline so would you have really held on to gold when it got clubbed by about 20% just eyeballing that right and then it's rising again but during this month it was down another it was a 20% draw down in a month, right? >> That would be like taking it today down to about 3,800. I mean, 3,300 or something like that, right? >> People go, "Oh, get out. Gold is dead. It's dead." You know, and then we have a 25% draw down and then a 10 and then another 25% draw down. But even here where it's like you only want to be in gold, there was another 25% draw down. Just to say volatility is a normal part of the process of your money dying. Well said. And that's one thing that I want to reiterate to listeners out there, and I've been telling clients this. Look, there's a lot of people that have been stacking silver and gold that are really giddy about the prices right now. And I am, too. Okay? I love the long-term fundamentals, but I'm trying to prep everybody that there's more than likely going to be some gut-riching declines that are going to occur as this process unfolds, just like you're showing there because that chart has been shown and I love the fact that you've pointed that out because that's wisdom for the listeners that are out there when you know, one I'm not seeing the type of environment where you have the ultimate top and in and even gold or silver right now, at least with the information we have right now. At least in the United States, you don't have that retail demand that's out there. Prices move so far so fast, most people are frozen even if they want to purchase it. From a long-term investor standpoint, this is a very hard place to be as well cuz we had the fundamental story, we had everything else that caused us to be in it, and now you've had this massive price rise in the short run. Well, sometimes that's the point where you want to sell and diversify somewhere else. But you you have to have other confirming indicators and other tools, but when you look at the fundamentals, you look at the amount of effort that they're putting in to try to suppress the price and how quickly it's recovering now. I mean, Chris, that much effort back in 2018, the price of silver would have been down for 15, 16 months before it recovered to smack like that. Mhm. >> And now it's not even lasting for a couple of days. So, I do want to stress those that are holding right now. Prepare yourself mentally. And if we don't get those declines, then okay, you prepared yourself for something that didn't happen. But if if we do get those declines, you need to be solidified in the reasons why you're owning that from a long-term standpoint. And if I start seeing the longerterm indicators that scream that we're close to at least a longer term top, then I'm going to be talking about it. But I just don't see that right now fundamentally. I mean, you've pointed out all the fundamental factors that are there, the geopolitical issues that are taking place, the manufacturing demand that's out there or the industrial demand that's out there, excuse me. So, that's a great chart for people to go back and look at and pay attention to because because I can tell you in that first price uh uh price spike that you saw there starting right before kind of midways in that chart right above the R, >> you know, there's a lot of people that have been in there that that that selloff would have made them think that it was over, especially with how the prices have been hit since 2012. And that's going to shake weak hands loose. Yep. >> So that one and then especially the next rise there. >> Yeah. >> That one right above there. >> Yeah. So that's the point where I think it would have tested a lot of people. >> I agree. And over your shoulder if people look, it says invest your plan, not your emotions. And this is emotional. It's Paul. It's so hard to sell when it's just making new highs because you're like, whoa, I I want to I keep riding this. It's even harder to buy when it does this down here. Yes, >> but and I'm not saying this is a perfect analog and I'm not saying this is what's going to happen in this chart. However, your dominant strategy would have been to buy every dip. >> Mhm. >> That would have been the strategy, not to sell out because it was, you know, got clocked for 25%. But to buy then, but I recognize it's really hard to do that. It It's just hard because you're going to have all these and particularly now with AI and AI headlines and all the marketing. particularly here in the US. I don't think they're as confused about this in other countries because they don't spend so much time trashing precious metals, but we do in this country and people have to be aware of that. And so when these dips happen that look like this in the US, you're going to be flooded on CNBC, Yahoo Finance, wherever you, you know, Wall Street Journal, Bloomberg, wherever you get your financial news from, and they're going to be telling you, "Oh, it's over. You know, smart people are selling. Smarter people sold a little before. um you know, stupid people are holding on. They're going to use all this emotional language, which is the definition of propaganda, to convince you to get out of the one real thing that could potentially protect you from >> Yes. >> the rest of the system, printing money. >> Yeah. >> Yes. Well, and I'll tell you one thing that's amazing to me. Nick and I were talking this morning. He reminded me of it. He mentioned the name. I can't remember the name, but I had had over the past couple of weeks probably 15 20 different people send me the same video and it's the guy talking about silver and 80% facts were right. >> The the Asian guy the but it's pure AI and it's half propaganda by the way. >> Yes, you're exactly right. So when I first started looking at it, it took me about two to three minutes to realize, okay, this is AI. Okay, so I I picked up on that. But then I went back and started paying attention, you know, how much are facts? And I just responded to everybody and said, "Hey, this is an AI video. There's some facts in there that are correct, and if you're not paying attention to all the details, you don't recognize the propaganda that's associated with it." So, you know, unfortunately, we're in this environment now where with the use of AI, that propaganda becomes more powerful and more powerful and more powerful. And I was having a conversation with some friends here recently. I don't know if you've noticed every sitcom that's out there that's funny, the guy is stupid and the and the female is you you know like like the the smartest wisest individual out there and and I was they they were teasing me why I don't watch those. And I said I don't watch them because propaganda works. It gets into your subconscious. You see it on a consistent basis and you have to cut it out. So, I think we're in an environment now where a trusted source becomes uh even more important to pay attention to and be very careful about, you know, something that you don't know someone's track record with and and especially making investment decisions on it because AI is getting far better than what it was just 3 months ago and harder to even notice. So, you have to pay attention to all the details of what they say. You can't just passively listen to it. you have to actively listen to it >> and that's becoming harder and harder and harder. I would say half my feed on Twitter now is just and not I won't say it's all AI slop. Um because some people legitimately use it to help craft a point they're trying to make. But as soon as I recognize I'm not reading their words, but I'm reading their thoughts expressed in AI words. I I I discount it by at least half. And if it's pure AI slop, I just I actually block the people now because I don't have time in my life to to even have to wrestle like for 5 seconds to go, oh, this person is feeding me slop. If it takes me 5 seconds to sort of does discover that block I because I don't have time for this anymore. I really don't. I don't care what Grock thinks about something. It does great on structured thinking and, you know, it does good math. I don't care what it thinks about geopolitics, politics, um, current events, uh, any of that. I I don't care because it's not it's not a human. >> I had a a friend that was telling me that we was asking Grockett's opinion on a decision that they should make and I'm like, man, that's really dangerous. Use it for facts. Use it to to find information in the tax code or whatever. But if you start asking it what you think and how I should behave in this way, it's a very dangerous thing to do with [snorts] AI. Well, it is because we we know that if if like if you get bedridden for just two weeks, all your muscles start to atrophy. This atrophies real quick when you start outsourcing it. Um so, use it or lose it is kind of how I I feel about the whole thing. All right, folks. When we come back, uh we're going to hear from our favorite sponsor right now, but when we come back, we got to look at the huge spread that exists between the price of silver in China versus here in the US. We'll be right [music] back. Today's markets are more volatile than ever with ongoing economic and geopolitical uncertainty. Navigating such environments requires thoughtful, adaptive strategies, not a one-sizefits-all approach. At Peak Financial Investing, our registered [music] investment advisory firm connects clients with experienced wealth managers who focus on active [music] portfolio management. These professionals use evidence-based strategies designed [music] to respond to changing conditions, not outdated formulas, but customized [music] approaches grounded in research, discipline, and risk awareness. We believe in open, informed conversations, including discussing tools like precious metals and diversification as [music] part of a broader financial strategy. Every investor's situation is unique, and our adviserss tailor [music] their guidance accordingly. Visit peakfinaniallinvesting.com today to schedule your free consultation and explore [music] how proactive management can support your financial goals. I'm Dr. Chris Martinson, [music] proud to work with Peak Financial Investing and my support reflects my professional views. I encourage you [music] to take control of your financial future by making informed decisions. All right, welcome back everybody. Paul, I want to move on to um just finish up a couple things in silver because there's two other big moves here. So, this is the this is expressed in a premium discount um and all that. So, remember in January of 25, silver was like 30 bucks an ounce. So, it might look like it's kind of comparable. So, this is expressed as percentage, not dollar terms, but look at what's been happening of late. Huge, extraordinary. This is that volatility. This just says silver is a lot more expensive in China than it is here. And this should not exist. The normal premium person should be hanging out around maybe 3%. Right-ish. Um you know we had one little clock down here in October which we discussed back at the time. But um look at this. This is enormous. And so this just means that the markets are fracturing. There's a market in China that's different than the market in the US. and that you can't. Commodities are not supposed to work this way. It can't be true. Let me take silver out of the game. What if you found out corn today costs $12 a bushel in China, but only costs $5 a bushel here? Well, somebody's going to load up a grain ship [laughter] and send it over to China. And those two prices are going to are going to equilibrate really quickly. And the only reason they wouldn't is because we don't actually have the corn to put on the ship. >> Mhm. to send over there. That's what that tells me is that we're we have a fiction which is that oh, we got plenty of silver. It's cheap. You just can't get any. >> Yeah, >> that's where we're at. [laughter] >> Yeah. It amazed me because I've I've made a couple of phone calls looking, you know, expecting to buy silver when Holly Kate was born and it's what, three, four weeks before you can get it at this point where where typically it was shipping next day. So, here's a question that I've got for you, Chris. Maybe another thought that I have. I know you've pointed it out and others have talked about it in the past. I cannot remember who it is. I'd love to give them credit, but years and years ago, I heard somebody predicted that these precious metals are going to leave the West and they're going to go east and they're never going to come back. So, could it also be that if I'm China and I recognize the long-term issue when it comes to silver, precious metals, and our currencies and everything out there that you're going to incentivize a higher price so that so that it's sold and shipped over there and it'll never come back this way. Do you think that could be a part of it as well? >> Well, absolutely it is. And you know I think one of the bigger dynamics out there is that um both in India and China which collectively is allegedly around two and a half billion people uh with with middle classes and upper middle classes that dwarf ours in terms of just numbers right because it's a numbers game and they have traditionally been high savers like 30% savings rates it's more like 12% in the US so they have a lot more savings to work with and they don't really trust their stock markets and real estate just burned Um, so what's left, right? There's not that much left. And of course, they have capital control, so Bitcoin isn't really an option in China. So what's left? Well, that that's where at least some of that buying pressure is coming from. Two, we just found out last time we talked or was it the time before that gold was creeping up on dollar reserves on a dollar basis in in central bank reserves. Last week they crossed over. Gold is now uh exceeding dollars in terms of bank reserves across the world. It's a big moment. >> Was that dollars or was it just treasuries that that >> No, this is total this is total dollars. You're right. We talked about it in terms of treasuries. Treasury holdings. >> Yeah, >> I could find it, but it' take me a minute um because I didn't I' have to scoop that back up again. But you know because if you actually revalue gold in current terms like it's just banks might not have bought a whole lot more gold but it goes up 100% in price value uh you know the reserve ratio climbs like that but it's very clear I heard from a big trader who operates out of the east um they told me that for gold the buyers now are just price insensitive they're just like they they're they're ounce sensitive not price sensitive or gram sensitive or kilo sensitive price sensitive. >> They just want to have ounces, grams, kilos. >> That makes sense. It's the most trusted asset and at the extremes, it's the better asset to own because if you have deflation, you don't have to worry about counterparty risk and you have hyperinflation. You've got a limited supply. >> Yeah. >> So, it does make sense. >> Well, I'm I'm going to I want to go further. Nick and I were talking about this and it suddenly or no, Tom and I were talking about this. Hey, Tom M. Um, so it suddenly occurred to me that, you know, I was talking it through. He's like, "Oh, you know, what was the impact of the Basel 3 Accords?" I said, "Well, you know, one of them was gold got moved into a tier one asset means it's on the same par as cash and treasuries." And I realized actually they ought to come up with a tier zero because if you hold gold in your hot little hands of your bank, for instance, or me or you, it's a tier zero asset because nobody else is the counterparty to it. >> If you hold cash, the counterparty is the Federal Reserve. Are they going to print more of them and debase it? You know, is the US government going to overspend them and debase it? Treasuries, you got a counterparty still, right? So, gold has no counterparty. And that I think elevates it to tier zero. And so, way back in the day, remember it was JP Morgan said, gold is money, all else is credit. And I mean JP Morgan himself, what he said that about 1906, I think, or somewhere in that early 1900s. >> Yes. >> Gold is money. All else is credit. Okay. So gold is the ultimate settlement, right? It it it settles itself like it just exists. It it doesn't need something else to happen for it to have its for its value to exist. So I think that actually places it above and that to me explains why institutions, family offices, countries, central banks have become a little bit price insensitive because the flip side of that coin is they're worried about settlement. They're worried about counterparties. They're worried about debasement. They're worried about all these other things that you can't control for. >> Mhm. >> Unless you have gold. >> That's right. >> I think that's I think that's part of the dynamic. >> That's well said, Chris. That's a very important point. And and another aspect is as you're going through that, I can't help but think, you know, that they've demonized the ownership of gold and silver for so long and even your major institutions on Wall Street now will still not recommend it at this point. And you know, my thesis has been that the crypto, especially the Bitcoin, uh, maybe it's in a power struggle between the West and the East, whatever that is, it seems to be a relief valve from everything that I see to reduce the demand from US retail dollars and investment dollars to go into gold and silver. Well, if it's such an ancient relic and and it can't be used as a monetary base, why are the central banks of the world buying it? Why are the big institutions buying it? Right? I mean, they're telling us one thing, but watch what they're doing, not what they're saying. And and that's just a lesson great for anyone in their lives, but what they're doing is they're accumulating that metal in a dramatic fashion. You talked about, I think you were the one that pointed it out, you know, the Indian banks this month uh are allowed to loan use as collateral silver 10 to1 on gold. That's incentivizing their banking system to uh to accumulate silver. So, you know, the East seems to be making a lot wiser decisions than what the West is at this point. And and you know, traditionally, they're very good long-term thinkers. And we've become very short-term and instant gratification in our country. And nobody's thinking long term at this point that they're just not. I mean, the the whole media cycle, the markets pushing it, get rich quick, the the rise of gambling like it has been, that's a problem. Dave Ramsey was just talking about how that's, you know, the the sports gambling is destroying the the the younger kids now because they're it's just incentivizing gambling. That is not long-term thinking. That's not how you build long-term wealth within a economy, individually, countries, or families. You have to think long term. Well, at the tail end of of every debasement, I was reading one of these Will Durant history books, you know, big giant tomes, and talked about Athens, uh, sometime BC. And this is at a period of time where they debaseed their currency, and it read just like today, you know, the the the wealthiest families became even wealthier and the scions of that those families got engaged in speculation, which ultimately just turned into gambling and there was all this debauchery and sort of a breakdown of social mores. A lot of things happen when your currency breaks down on you. It's a terrible thing. It really it's a very bad thing. And if you want to destroy a country, there's no sure means of doing that. The British understood that when they were trying to fight us in the Revolutionary War, they they uh they counterfeited tons of these things called continentals, cartloads of them. And they they understood perfectly well back then that if you debase a currency, you debase every transaction. You debase people's faith. you sap their will to do anything productive, it's it's very destructive. Um, and I think the Chinese understand this maybe better than most because their LA maybe they've changed this, but last I heard their actual term, their their Chinese character for a a a paper note, it's called um flying paper. They don't call it money. >> That's wonderful. >> Flying paper, [laughter] right? can noting that that back they've been through multiple iterations of this stuff and it just ends up flying, you know, it's just becomes useless, right? So, so we're on that path and there's still time for people to get prepared, but just you got to read the warning signs for what they are, you know, and and that's what I'm seeing in the gold and silver markets is >> yes, acute warnings. >> Absolutely. And look, for for those that that don't have exposure, this is not a recommendation because I can't give a recommendation unless I'm talking to you individually. So this is just educational p purposes and strategy, right? [snorts] Develop a plan. If you have none, develop a plan. It can be as simple as over the next six months on the last week of the month because typically you get a big slam on the last week of the month. I'm going to average in, you know, a sixth of whatever I'm going whatever is appropriate for me to allocate into. And if we do get those 10 or 15 or 20% pullbacks, then you double your purchases. Okay? So in that case, it keeps you from being frozen. If this price just continues to climb like it has been, yeah, you didn't get as good a price as what it would be if you bought it today, but you're also not going to have that that gut-wrenching emotional pain if you allocate fully today out of a panic and then next month it's down 15 or 20%. I you know I'd still think that you're going to be fine from a long-term standpoint, but work a strategy and keep some powder dry so that if they are successful for an intermediate period of time for whatever reason to smack that price down that you've got some capital to take advantage of it. But and that and what I have found is that helps people not be frozen like a deer in the headlights, right? And and it keeps them from panicking purchasing. Work a plan. control your emotions as much as you can until you get to that appropriate amount for you and your situation. >> Indeed. Indeed. One last thing to talk about in the silver market um which is kind of interesting is this that uh the United States government, remember we secured some interest in Intel and other companies and like that. But now the Department of War, still mislabeled Department of Defense down here, somebody hasn't quite caught up with the with the latest. Um, uh, the Department of War, I think, threw a couple billion dollars into a refinery. It's going to hold a 40% stake in a in a smelter in a joint venture. It's going to be in Tennessee. So, this is finally, Paul, I think, uh, this is positive in the sense that finally finally, I've been screaming from rooftops for 20 years that we ought to have our own domestic supply chains and also stores of these things because you need a deep larder. And the United States has made this, I think, tragic error of outsourcing everything from the from the smelting on through to the fabrication of the finished products, right? It's one thing to get iron out of the ground. It's another thing to have 62 grades of chrome alley, you know, high-grade steel that you can use and things, right? There's a lot of steps between here and there. We've been content to just buy this stuff from other countries for the most part. Let our own domestic industries and most importantly, our domestic knowledge atrophy, if not completely, go extinct. And this is at least maybe a a reversal of that saying, hey, maybe we should own the beginning of the supply chain. And there's more after this. It's one thing to smelt and refine metals. It's quite another to turn them into the all the grades of products above that. But we're going to have to start doing this. I can't imagine anything stupider than saying, "We're going to go to war with China, but we're going to have to call them every Tuesday for a resupply of the missiles we're going to shoot at them." [laughter] >> Yeah. No kidding. Isn't that terri? I was I was really excited to see that news there. I really was because because it it just builds security like you're talking about within our country. It makes us more independent instead of codependent. >> Absolutely. Moving along. Um various colored flags flying over Japan. Um uh and and Japan's hard to make sense of. So I Paul, I had to turn to a children's book. Um you remember Dr. Dittle series? I read these to my kids and there's the push me pull you, right? It's this it's this creature up here which has a head facing one one's pushing, one's pulling the push me pull you. So to me this is Japan. It's the push me pull you. So the push um record-breaking 122 trillion yen budget which for Japan is a lot. A yen is aboutund what 55 to the dollar. So it's just under a trillion dollars but for for for well well under but I mean for Japan that's a big deal. So that's announced on December 25th. And at the same time, Bank of Japan is tightening. So you got monetary stimulus coming out one end and you got tightening on the other end. And the tightening is winning right now because we're seeing yields fly up. So this is Japanese 30-year yield spikes to 4.65. Actually, it's at 4.99 just a few minutes ago when I checked. Um, but anyway, this this is the highest in history for that series. is the 30-year Treasury yield. And so the they're on fire, and not in a good way. Um, same thing, we see this, the Bank of Japan, uh, they cut 500 billion from the balance sheet. So, they're trying to save the yen. Remember, that's what we talked about, um, is that when you get into the problem Japan's in, you either save the bonds or you save the currency. They save their government JGBs or they save the yen. What does that mean? Well, if you want to save the currency, you have to let the bonds go because that means you're not going to as the bond yields rise, the Bank of Japan isn't going to print money, which makes the yen weaker to buy the bonds to keep them contained. So, they just let the bond yields rise and so that helps save the yen. So, they're clearly saying Bank of Japan is like, "Dude, we got to save the yen." On the other side, you know, you got the the government of Japan saying, "Ah, forget the yen. We're going to spend this like crazy." Those two things are fighting each other right now. And that's why we see this craziness, which is the 10-year yield partying like it's 1999. They say here it's the highest level it's been since 1999. Um, and that's the 10-year yield. We were looking at the 30-year yield before. So, in the push me pull you, yields are flying. The yen should be strengthening. It's not. It's bouncing along. It's it gets the yen is getting weaker as it goes down in this way because it's expressed against the dollar. So, um it it's it's at a kind of a critical level. And these things here, Paul, if you see this, this is basically from 2020, we're watching this scream up like this. From 2020, we're watching the yen get weaker and weaker and weaker. This is an untenable situation. Something's going to break. >> Remember Silicon Valley Bank? Why did they go down? because they were oversp speculated in in the uh 20 and 30-year bond or treasuries, 20-year treasuries. And when rates went up, all of a sudden, they don't have the liquidity to survive. So, you're going to have something break in the Japanese banking system. I'm assuming they're working the same way that the US is. You're going to have their currency crack or ultimately you're going to have all of that take place at some point. And then that's going to have re reverberations that are going to ripple like a massive earthquake around the world in the financial system. It >> it will. And I don't know how this resolves, but remember things break slowly then all at once. Um, you can really feel the pressure building in the Japanese system. This is not what's supposed to be happening. What what's supposed to be happening is we should be seeing the yen strengthening. >> Yes. Yes. >> Right. And we're not seeing that. So, in the push me pull you, you know, there's obviously huge amounts of pressure to stimulate the economy and the the new um uh prime minister over there, Takichi, is uh just going to spend like crazy. Bank of Japan's desperately trying to like keep all of this contained, keep the Japanese bonds from exploding too fast, but hopefully without tanking the yen. And this is kind of a critical level. A lot of people said this bounces right at the 160, 160 yen to the dollar. A lot of people have said that's critical. I don't know why. Maybe it's a round number, but you can clearly see they've been defending this as best they can and it's cost them an extraordinary amount in yields. And the problem is that this becomes a fiscal crisis for the Japanese government at some point because they're going to want to borrow that money. They're going to have to borrow it at a higher yield. That higher yield is going to have higher interest payments. Those higher interest payments are going to make them have to borrow more. As you borrow more, you have higher interest payments. So it they could get into that part of the stage and and that's the concern. And of course then who even knows what that means for the carry trade, whatever that is. I've asked a lot of people, Paul, how big is a carry trade? Nobody knows. But it's big. Um it's huge. And it's strategies that have been embedded embedded especially on Wall Street and hedge fund community for what 20 30 years since Japan started their markets cracked in 1989. 30 40 years now. >> So uh near 40 years. So, you know, and all they're doing is buying time at this point. It's not fixing the underlying issue. It's just buying time. Are they trying to kick it off to somebody else's watch? Is that what this boils down to? Instead of just ripping the band-aid off now where where it's easier to deal with than it would be on the other side. The longer you put this off, the worse the consequences are going to be. >> So, let's say you're in Japan and like you're selling these bonds. They're just toxic now at this point. You don't want the bonds. You really don't want to hold anything in the end. So you really only have two outputs there. One is gold and the other is your domestic equities. Um those are your other sort of relief valves in the story. And on that front, despite everything we're talking about and the the potential for a catastrophe of currency or a bond catastrophe, you see here that Japanese stocks have just been on a 45 degree ups slope. Um, and so this could indicate that what's happening now is that you're seeing the domestic uh sources of e of capital, flee the bonds, back away from the yen, but putting their money into something that represents a more tangible sense of ownership and a profit-making enterprise. Or if I showed you the I don't have it with me right now, but but gold priced at yen. It looks like looks like time is about to bend backwards. It goes up so steeply, you know. >> [laughter] >> It's like a It's a pure parabolic. >> You showed that chart a while ago with the with their longerterm yields and gold price and and you can see it's matching right in line with it. It's it's quite amazing actually. >> Yeah. So again, Japan is my darkhorse candidate to really get the party started. Um which is a debt crisis. We've known we've we're going to have a debt crisis at some point. Remember stocks are for show but but bonds are for dough. we have a a sovereign self-funding crisis and you know if it breaks in Japan I think it spreads to the US very quickly because right now >> it turns out foreigners are backing away from US treasuries for good reason right seizing so Russia's sovereign assets proving they're neither sovereign nor assets playing funky do stuff with the swift system the Venezuela stuff we'll talk about that in a minute um but they're starting to back away who's buying all of our paper we're still printing a little over two trill ion a year for for US government paper. >> That's that's a really good question. I would say I would say a lot of the administration is really happy of these lifestyle funds that the older you get, the more it forces into the bond uh bond and treasury portfolio because there's also passive investors that are going into that area and they don't even realize it, most of them when I tell them. So, I mean, that's an issue long term. Let's keep our eyes on things because the 30-year Treasury is now um it's only back to where it was in September, but it's not going down. It should be going down because we're in a rate cutting cycle. It's going up, not down. Um so, it's not at anything close to a a desperate level at 4.88, but it's a little bit of a worldwide problem here where we're seeing Germany, Britain, France, US, Japan, all of their longdated papers uh yields are going up, right? So that speaks to maybe there's there's a a longer term some something else is brewing here. Um don't know. Anyway, something to keep an eye on. But um hey Paul, we're going to take another quick break. When we come back, we're going to talk about this uh the whole Venezuelan thing. There's some really important things we should be talking about here. So uh as soon as we come back from this quick break, uh we're going to talk about the Venezuelan oil industry and what it means. 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Take charge of your future, folks. Don't wait for the system to fail you [music] any further. Head over to peak.ban/goldcore. That's peak.fban/goldcore [music] right now and claim that free storage. You won't regret it. I sure don't. All right, welcome back everybody. Paul, Venezuela. Uh, what what what did you what did you think of all that? >> Oh, I'm still trying to process all the thoughts that I have going with that. I wake up early that morning, you know, get up, have cup, I don't know, was 4:00, 4:30 in the morning, something like that. And I sit down, pull up, you know, X, and I'm like, what? What just happened? It was unbelievable. Yeah. I was I was com shocked is is the only word that I can come to right now and I'm still trying to process exactly how I feel about it. But I was shocked needless to say. >> Well, it it's I I fit it into a sort of a larger sweep of things, right? Which is um remember so Trump shortly after inauguration calls Canada the 51st state. And then very weirdly because I didn't see this wasn't on my radar screen at all. He's like Greenland. Maybe Greenland should be part of our sphere here. So what what's clearly Venezuela fits into this thing which is like oh kind of looks like the United States wants to operate hemispherically or at least regionally in the sense that like hey South America our backyard, Canada our northyard, our front yard, you know, Greenland kind of on our side more than your side, Denmark or whatever. just if it kind I think that's what we're looking at here is a is a um a sense of saying okay this is our this is our real core sphere of influence which I wouldn't mind I'm actually okay with that on a number of levels I differ in that I would prefer to approach all of those potential partners with deals and wins and with respect and you know finding ways to create win-win I understand that's not how the US has operated for a long time we prefer the gunboat over the checkbook. It's fine. Um, not mine to to say, but we did that. And then I was The only thing that really shocked me, Paul, is is what's happened since the statements coming out of the Trump administration. I don't know how to make sense of them, to be honest. I just don't >> I'm with you. That's one thing that has me just my wheels spinning just trying to figure out what's the real truth of what's taking place. Now, I will say this. Did Go ahead. Go ahead. No, I was just going to show you what what Trump tweeted this morning. >> Yeah, I'll save this for later. Um um but so go ahead. I want to see what he tweeted. >> All right, save that. Make sure make sure you keep that. Um Trump says, quote, "I'm pleased to announce that the interim authorities in Venezuela will be turning over between 30 and 50 million barrels of highquality sanctioned oil to the United States of America. This oil will be sold at its market price, and that money will be controlled by me." M. Wow. Wow. What's that supposed to mean, Chris? By him. >> What do you mean by me? That's That's not how this is supposed to work. >> Uh, is that some merger with True Social getting ready to take place? I'm not sure. >> I I I I don't I maybe it's just poor phrasing. you know, this is just Trump tweeting out, but I can't make sense of. So, that basically takes the gloves off and says, "Hey, we're going to take your oil here." Um, and to sort of cement that, we had the Department of Energy's secretary is Chris Wright, former CEO of a fracking company. Maybe he'll go back to that, but but comes out of the oil business and he's at a Goldman Sachs energy thing yesterday. And um let me know if you have any problems hearing this. >> Uh the president recently announced your role in executing the plan to turn over between 30 to 50 million barrels of sanctioned oil to the US. We learned about that as a as an investment community yesterday. What can you share about uh the recent announcement and talk about the plans to execute this? Yeah. So, look, I'm working directly in cooperation with the Venezuelans and we and we are going to this is this is the crude that's backed up and onshore storage and that's in offshore floating storage. We're just going to get that crude moving again and sell it just like we did in our businesses. We're going to market the crude coming out of Venezuela first, this backed up stored oil and then indefinitely going forward, we will sell the production that comes out of Venezuela into the marketplace. We will have US as the supplier of dilluent that's got to go down there to enable that production. We're going to have that flowing again. And as we make progress with the government, you know, we'll we'll enable the importing of parts and equipment and services to kind of prevent the industry from collapsing, stabilize the production, and then as quickly as possible, start to see it growing again, and of course, in the long run, create the conditions that the major American companies that were there before, maybe that weren't there before, but want to be there, will go in. The resources are immense. This should be a wealthy, prosperous, peaceful energy powerhouse. That's the plan. >> Okay. What did we just We just heard that we're going to seize all the oil that they've pumped over however long and we're going to sell it like as if they needed help. You don't need any help selling oil in the marketplace. You know what you need? Trafigura or or I mean just you just sell it. You just like any No, they don't need help selling it. And then he said, "We're going to we're going to be taking their production going forward and we'll sell it. Under what terms, under what sort of authority?" Like, "How much do we keep for our troubles versus give back to the Venezuelan people?" Like, it's all a little vague at this point in time, but um all we do know is that it's going to be controlled by Trump. >> Trump. >> So, >> and if you if you add what he said, he said indefinitely. >> Indefinitely. >> Indefinitely. Yeah, good catch. Indefinitely, which remember we temporarily closed the gold window in 1971. There's nothing quite so permanent as temporary, the federal government. But also, I think indefinite is even more permanent than that. It's like infinitely >> indefinite indefinitely means these resources are ours now and we're going to do with them what we want to do. Mhm. So that um whatever people feel about Mike makes right or foreign policy or any of that stuff, this is the most transparent and honest expression of that. The United States has basically said, "We're taking that. That's ours now." Um and again, that's going to have a chilling effect on potential trade partners, my guess, right? I would anticipate. So, I mean, I I I just it it just amazes me because, you know, I can't remember the exact scenario that we used before, but if I had a friend that was was doing business at the same bank as me and without the rule of law, this goes back to when we took the reserves from Russia, without the rule of law, his his or her bank account is seized, right? It, you know, indefinitely or temporarily or whatever, I'm leaving that bank. There's no way I'm going to leave my funds there, especially if they're not following the rule of law. So, how in the world do you do you do business in this manner unless you're going to kneel down and kiss the boot? And that's not mutually beneficial because what's going to happen is those in those other countries are going to look for their opportunity to strike us in our Achilles Hill when they get that opportunity. So, it just makes it a much more uh dangerous situation from a global perspective. >> China has made a lot of investments there. So, some of this is just kicking China out. But what I've read so far is that China's not happy about that. And and they're going to flex their muscles in a whole new way around this. They're not just going to sort of pout about this and maybe issue a couple harshly worded statements. They've said, "Wow, get welcome. Get ready for a lot of legal action because they have contracts and all of this." And and so they're about to just dial up and say, "If you want to break contracts, that's fine. But we have other contracts over here." and they've already taken steps to say if you're going to do that, if you're going to unilaterally just abregate those contracts that we have, then we're going to start taking these other steps, including cutting off rare earths again and doing other things that could really limit our ability to function well. >> And I thought that was interesting. I read a I read a thread on talking about how they were going to take legal action and just how important the outcome of that legal action is going to be for global business. And while you're looking at that, Chris, or looking forward that, I'll ask you this question. I had read somewhere, and I didn't save it because I didn't anticipate it needing it. Uh, it's I don't I have it saved. I just can't find it right now. Let's put it this way. So, there was a statement made that apparently Venezuela has a massive amount of of gold, not necessarily reserves, but a massive amount of gold in the ground that that is there to be mined. Have you heard that as well? >> Yes, I've heard that. I also heard that that it got potentially shipped out um right before the attack happened or the rescue operation or the or the stand aside operation. Whatever actually happened, I don't know. I'm out here in the cheap seats. All I know is whatever I read is usually not true. Um there's more more going on behind the scenes obviously than we could ever know. >> Mhm. This is popping up just as breaking news as we're recording this. Um, it's coming out of a German station here saying China is preparing to transfer missiles, air defense systems, and drones to Venezuela to escort Chinese oil tankers. So, they're basically saying we might be enforcing our own set of things. Who knows um what that really means. I can't trust can't really trust anything these days as we talked about already, [laughter] >> you know. Isn't it amazing? we have all this access to information and now with AI and all of the propaganda that's out there, I find myself every time I see something like that, it's like, okay, now I got to go down a rabbit trail to try to [clears throat] confirm it in several areas and it takes two to three time uh uh two to three times the amount of time that originally took to be able to look and find something. >> Yeah, >> you just have to go verify it. Um, one of the things I can add to this because I've studied the oil business intensively for the past few decades and I'm an investor in in oil and gas and all that stuff. Um, is that oil isn't oil isn't oil. I know a lot of people don't know a lot about the oil industry. It's always presented as if oil is a a single word. Like we we said cotton. It's kind of a thing, you know. Um, but if you're into cotton, you realize once you process it, you know, you could have Egyptian thousand thread count sheets or you could have like a, you know, a brillow pad equivalent, you know, sheet set from Walmart, whatever. You know, it's all different. So oil isn't oil isn't oil. We get in the United States, we're busy drilling shale oil, which is typically very, very light. It's almost gasoline. In fact, coming out of the Eagleford shale formation in South Texas, it might as well be gasoline coming out of the ground. Literally, some of that stuff can be put straight into an engine and it'll work, right? So, we have really light stuff. Venezuela has some flowing stuff um in the Marrabo fields over there on the western side, a little bit on the east, but most of it when they say 300 billion barrels of oil is this stuff. It literally looks like that. Uh it does not flow. It's tar. It's not just like the tar sands of Canada, that's that's formed out of a substance called bitammen. This is uh shot through with what's called asphaltines. It's basically road tar that is not quite fully dried yet as one person put it on Twitter recently. Um and it it's just hugely expensive to get it out of the ground and to process it. So you heard Chris Wright say, "We're going to supply the dilluent." What's that? That's your dilutive stuff. We get this stuff out of the eagle fur. It's practically gasoline. We now ship it to Venezuela and they pump it in the ground to sort of like loosen the stuff up so you can pump it out again and push it off towards a refinery. It's very expensive to get done. But what was left unsaid in that is this is a shot across the bow to Canada [snorts] who also supplies heavy bitamin laden oil that requires a lot of dilluent to turn it. uh they cut it so that it flows so you can put it in a pipeline or a tank or something and get it back out of the tank. This stuff, if you put it in the into a tank, you'd have to use a spatula on the way in and a shovel on the way out. You know, it's just it doesn't flow. So, it it's extraordinarily expensive to get this stuff to flow. And by the way, the DOE said, "Oh, you know, Chris Wright said, we're going to do all this stuff." They don't have none of this is in their budget. None of this, right? They don't have any money for this. So that's why he said, "Oh, we hope to create conditions where Exxon comes back in." If I'm Exxon, I'm just going to be squinting at this for a while because what if Trump loses the midterms? What if then you get a Democrat president who says, "I'm going to undo all of this stuff Trump just did, but you're halfway pouring $50 billion in." You're not going to do that. You're going to you're going to need to see some form of guaranteed stability for a while before you're going to invest that kind of money. I I this whole idea that that people like, "Oh, we get all this free oil now." It it's just it's not true. It's not how this works. >> That's a very good point because because I I don't know how politics are going to unfold, but I do know know that there is a tremendous amount of Trump supporters that are ridiculously frustrated with him and the Republicans and, you know, not not doing what they said they would do. So, that's a very good point, Chris. And if you're a major business, what does it matter to you if you wait 9 to 12 months or 24 months? >> Well, all the majors, they already have their capital budgets for next year are all decided already, right? They in order to spend money in Venezuela, they would have to pull it off of some other project. Those other projects have already been sifted through as the best of the best they have to prosecute. So, the Venezuelan stuff would have to slot in and be even better than that. So that's why they're going for the quick hit, which is of the stuff that Venezuela already pumped out of the ground, which belongs to Venezuela. It's theirs by every possible understanding of how the world works. And we've just said we're going to take those 30 to 50 million barrels. We'll take them. We'll sell them. And if we're feeling kind, we'll share some back with the Venezuelans. Right. But but this is this sort of the the idea that we've just seized a lot of oil that we can immediately prosecute is not true. If you seized Saudi Arabia, it would be true because that stuff's flowing out of the ground. It's a medium grade, medium heavy, sometimes light. It's good stuff. And you know, you can use it right away. The Venezuelan stuff is more complex. It's all I want to communicate. It's just it's this is a very complicated substance. And by the way, to get even more wonky, it's shot through with sulfur, heavy metals, all kinds of stuff. We can process it, but you kind of have to um do that. And it it typically has to go into a cracking process which is 500° C with hydrogen very it's expensive. I don't at today's price even if Exxon said we have unfettered access to this for the next 10 years at 58 a barrel which is current price today it's not worth it. I think this has to be oil prices have to be 75 to 90 before you would say okay. So it this whole idea that we just took a lot of oil and it's going to make gas cheap next year is just not correct. >> It looks like peanut butter. Is that a good explanation of the consistency of it? >> Yep. And the equivalent analogy would be uh trying to get that stuff to flow through a pipeline would be the same as putting a scoop of peanut butter on the roof of your dog's mouth. [laughter] >> Have you ever seen that? >> That is great. That's a good good visual picture. >> Well, it's a big deal from a long-term standpoint. I mean, it it it really e either way, I mean, there's so many ramifications of this behavior. And what concerns me is is, you know, we just continue to cross lines, right? We just continue to cross lines. You can justify it however you want, but we're continuing to cross lines that that we did not cross before. our our morality and our integrity kept us from from crossing, but that doesn't seem to be a restraint anymore. >> No, that that those gloves got taken off. That's really what happened here. And I'm I'm worried because again, it's both the appearance, if not the fact of the rule of law that gives our capital markets their advantage. And it's only a hop, skip, and a jump to say, well, if you don't respect international law, which by the way is kind of somebody put it on Twitter. They did it a great job. They said, hey, you want to hear a joke? International law. Um, [laughter] it's it's not really a thing. It's been everybody ignores it. We pretend like it's something when it's convenient, but otherwise we ignore it. But but still there there is the the sense of saying wow to trample some other country's sovereignity and then blatantly say your stuff belongs to us now. Hey that's happened through empires all through history. But it's a hop skip and a jump to go from that to say but are you going to treat my sovereign reserves or or my personal accounts as a foreigner in your capital markets? How safe are those? It's a fair question and I don't think you get to erode that trust [snorts] too many times before people go I'll take I'm just going home take my chips. >> That's right. And if you're another country, we did it to Russia. We justified doing it to Russia with their nuclear capabilities. So what what are you thinking if you're a smaller country? Who are you leaning towards right now? Are you leaning towards the east and the bricks where where you know I haven't heard them crossing these lines at this point. they seem to be building an infrastructure through the unit that has checks and balances in there for that accountability, especially if they're backing it by 40% with gold and then a country's natural resources and their economic output. So, um, alternatives are emerging and that's the first time we've seen in a long time alternatives to the US position of power as a global reserve currency. and and and I've heard those that have argued, hey, this just reliqufified uh the dollar is the global reserve currency when they took over Venezuela. I don't know if that's actually what happened from that standpoint or not, but the fact that somebody's talking about that just tells us how weak of a position from a trusting standpoint that the dollar has become on a global basis. I don't know that you would have heard anybody talking about that 20 years ago, 25 years ago. >> No, probably not. But 25 years ago, we had a trillion in debt rather than 38. Um, and so I've heard numbers bandied about like, oh, there's 17 trillion in assets in Venezuela. There are like, well, that's like literally less than half the current US deficit of debt level, right? Our deficit is still over $2 trillion a year. Um, and so, but the the reality I want to point out is that, yeah, you know what, we squatted in Syria, the United States did, and we took a lot of their oil. Um, but that's in the desert. Trying to defend a jungle environment. Totally different, right? Deserts are kind of easy to defend because you can see people coming from literally dozens of miles away and makes it trickier. Jungles are just different, right? Um, and it's a tougher environment to operate in. And that Oruronokco belt that where all that stuff is is about 8,000 square kilometers. It's a giant region. So, how many boots on the ground is that in the jungle? I don't know. It's a very big number. So if we're willing to commit that, my point is that 17 trillion, Paul, isn't like a chest of gold you just go and pick up, take home. You got to go there. You got to extract it. That's hard. People, locals may get cranky about that over time. That makes it more expensive. Um, and so anyway, I I've seen a lot of like crazy stuff floating around. It's like, woohoo, you know, we just 17 trillion. I'm like, might be more complicated. Let's see how this plays out. >> Well, that's well said. and and when people read those short headlines, they don't think as deeply as you do about the the long-term picture from that standpoint. So, I'm glad you pointed that out. >> Well, can um as we close out today? Well, we got a couple more things. Did you see margin? >> Yes, I did. I I've been amazed by that actually. I really have been like there's no restraint right now. It looks like investors are it's going vertical and it looks like in investors or those that are willing to to leverage themselves to the hilt >> are uber bullish right now with that move and and I just don't understand that. That's speculation. That's not investing. >> Well, do you think there's a chance it's it's related to the idea that the Federal Reserve has been like slowly tightening and winding down its balance sheet for a number of years now and is suddenly U-turned and is back to printing money. By the way, this isn't QE. Not QE. Totally not QE according to the Fed. It's not. This is reserve balance management. [laughter] >> I can't wait to I wish I would live a hundred years to look at the history books and see see how they phrase all of the different names they've had for QE. >> But um >> money protection. >> Yeah. Well, and it makes sense, Chris, if if they're going back to expanding the balance sheet and back to printing under whatever whatever name they want to call it or term they want to utilize it. It's a reflexive uh response like Pavlov's dog from your big institutions that have been utilizing leverage, especially the ones that appear to be too big to fail. Why not? I mean, if you're in a situation where you think the government's going to completely requefy, destroy the bond market over the long term, >> let inflation re out of control, then why not lever yourself to the hilt? That's not something that that I believe people should do individually because the risk is just way too high if they don't pull this off. But if you're a big institution or a hedge fund playing with somebody else's money >> and and you're two and 20, you're getting 2% plus 20% of whatever the gains are and you have nothing to lose if you blow up, you're losing client money, you've got everything to gain by that risk. Why not lever to the hilt? And you know that's one of the reasons we never set up as a hedge fund uh structure and compensations because the risk of carrying you know the temptation to pull all of that extra risk [snorts] in there you you know maybe that's the reason why I mean if you go back to 2012 2013 you were concerned about printing and what that was going to do in the interim period hindsight especially all of these models because mo most of your computer trading algorithms are based off of historical performance really for most of it that I've seen. I don't know this for a fact, but since 197374, then of course it's going to tell you to lever yourself to the hilt right now because they're going to reflate uh reflate the markets and the reflation trade is on. And they're probably more confident right now than they've ever been because they're looking in the rearview mirror without realizing that worked during a period of time when inflation didn't get out of control. We were still recovering from all the deflationary forces that occurred from 2007, but that's a completely different environment for where we are right now. >> Well, it it it is and um but you're right. Uh every single time the Fed has started the money spigots opening up, the go-to thing just buy risk assets by just just do it. So, we could be that the margin debt is just people saying, "Hey, I see the Fed's expanding its balance sheet. That is it's managing reserve balances. It's printing money." And every time that's happened in the past, pile in. In fact, pile in with leverage, right? Make sense? >> It makes sense. But I I there must be something more to this cuz Okay, Germany is in total economic basket case right now, right? It's in terrible shape. >> It's just awful, right? Collapsing energyintensive industries is just stagnant. It's just terrible. But but against that, well, the the the DA the DAX is making new all-time highs here. >> Same story, right? Are people piling into German risk assets because it looks like a great time, you know, to to own German risk assets. I don't know. I'm just It seems to be a global thing. The Nikkay's at all-time highs. The Dow just punched into one. The DAX. So clearly, there's this huge amount of money flooding in to that whole story. And then we see that the Federal Reserve is like, well, against that backdrop, you know what the most important thing here is that we do. [laughter] >> We better print. >> Exactly. [laughter] >> No, but this is annoying to me. In fact, it's infuriating because I just spent over the holidays with my kids, right? And um my eldest is 30, my youngest is 24 now and 25. and uh and they all say they have no hope of buying a house unless somebody helps them, right? That and all their friend groups are feeling the same way. Nobody they know is having kids or starting households really, right? It's it's like way on the back burner. And that's because somebody keeps printing money to bail out the rich people so that they don't experience even a slight decline >> and they're throwing the next generations completely under the bus. And it's by policy. It's not an accident. It's a policy. and it's destroying, damaging the next generations. And I I I can't be more contemptuous of that approach. I think it's not even shortsighted. I think it's evil to be honest. >> No. Oh, I agree completely that it's evil. And if anybody out there is wondering whether there is a good or evil, that is just absolutely one blaring um siren that yes, evil does exist because it wants to to harm others for your own benefit. And that's what the the the wealthy are doing. Harm others. It's not mutually beneficial. This isn't taking care of the next generation. And then I I've said this before. The Bible says, you know, if you read it at the surface, you know, a good man leaves an inheritance to his children's children. Well, in the United States, we've been taught the prosperity gospel for so long, and I know I've said this before for those of you that have heard it, but it's worth saying again. It's more than money. It's it's it's a good name that you pass down to your children. It's it's a good example that you set for them and the generations around that opens more doors for them sometimes than just dollars can open and and if you're you know if you're laying a foundation for the next generation that they can be better than you and and and they can catapult beyond you. It seems like this is the first cycle or generation throughout history that really doesn't want their children and grandchildren to do better than them. And that that seems to be a narcissistic, you know, decision. Hey, I'll give you a bunch of money so you can remember me and your future is going to be because of me instead of and I'm not talking about family side. I'm talking about on the nation side. Hey, we're we're we're making a few sacrifices for ourselves now and we're going to go through some pain in the interim period so that you can have a better foundation so that you can better your future. That's not what we're doing. We're not we're not setting up an environment to where an inheritance goes to its children. So the opposite side of that is what you would assume that an evil uh individual, you know, leaves absolutely nothing but stones stacked against them. I mean, how much harder is it for a kid that grows up in a community where their their parents and grandparents had a horrible reputation for not being trustworthy, for not paying their bills, for not keeping their word. So what happens like I know a young man right like that in our community that is completely changing from what his family line is but it's so much harder for him because we observe right are you different and and and that's a stark comparison to what good versus evil would be. Evil's all about me at the expense of somebody else. good overflows into the lives of the community and those that are around them and especially in their children. And it's just heartbreaking to me. It really is. Evil is the perfect term for it. Chris, >> I completely agree. And um there's also this idea that things are changing too rapidly for people to or cultures or communities or individuals to to really adapt at this point in time. It's too fast, right? Like what's happening with AI? It's too too fast, right? And um what's happening in geopolitics is just too fast. And and so this is this is the time when I think you have to you have to be prudent. You have to be aware, you know, you have to know where the puck is going to be harder than ever because it's full of AI slop out there right now. Um and it's just it's hard to tell what to trust. I've seen everybody from the president, Elon, all these conservative influencers, all accidentally or intentionally retweeting and sharing um fake stuff and presenting it as real. And that really begins to break stuff down, right? When you can't even trust what you're seeing, you know, >> creates a tough environment. It really does. So, I actually think the wave of the future is going to be people ditching their smartphones. Getting away from all that, going, you know, you live out in the country, I live out in the country. We both got farms. People are going to want to get dirt back under their fingernails. We're going to want to swing hammers, maybe get sore thumbs, you know, learn from physics again, right? It's going to be I I think I think there could be a a bright side on the back of this. But first, we have to understand just how toxic it is for us to outsource our decisions, our morality, our conclusions, our thinking to anybody else, let alone a machine, >> right? Yeah. Let alone a machine that has learned off of human nature and the weakness that we have in our human nature. >> Right. On that on that front very quickly, um I know we we got to close up here, but did you see this tweet from David Shapiro? He wrote, quote, "You guys realize that all software is about to be free, right? And software presently is the most valuable capital asset, right guys?" And Elon said pretty much. >> Yeah, I did see that. But what does he mean? Do you know what he means by that? So what what he means is um Nick was just telling me about a friend of his, leave him unnamed, uh who knows nothing really about coding and technology, but was using cloud claude plus a couple others and coded up an entire tech stack to to perform a function like you can you can write your own software now. You can >> wow, >> it's really not hard. You just sort of tell it what you want it to do and it does that. Um and and so I only thought about that because this I thought should be on your radar screen. Um you know we see that like you know Linux is free, Docker's free, GitHub, Git, um Python, all these things are free and so now that average people can start writing their own software. Um did you see this big rotation out of software uh recently and into semis? >> Yes. So the semis would be the play. If this is if that thesis is true, it would look like this. I'm not saying this is exactly what's happening, but the software companies are going down, but the way you operate the software, which is those top ones, are going up. Two dots make a straight line. So I'm not sure if we have enough data, but you know, you know, you know what's interesting? Before I saw that tweet, I was just cruising and perusing sectors and sector performance in comparison to other and looking through our tools and this big red flag came up in a lot of your software producers. I'm like, why is that price action taking place the way it is? And then I see that tweet and I'm like, okay, there you somebody in the market knows something and you're starting to see softness in the in the software. So, I'm glad you really pointed that out because I had already seen the action, but just didn't put two and two together because I wasn't I did not realize that it was that easy to code with AI. I mean, I I had heard that it was, but I didn't know the average person could build a code like that. Well, and and editorially, I guarantee you there's a million kids going into debt in college to become computer science engineers because the colleges haven't figured out because they're not rapid adjusters that the whole world is shifted out from under them and they're just turning the crank and teaching kids, you know, software coding when that's not it's already dead. It's it's already over. >> Yeah. Right. >> Well, I mean, they're they're a they're a a self-interested extraction machine from the younger generation is what they are. even if they recognize it, you've got all these professors and individuals that have positions of power that are going to refuse to make an adaptation because they're close enough to retirement [snorts] >> and uh you know, unfortunately, you know, they move way too slow because of their own benefit. >> Yep. Indeed. So, uh tricky environment. How how do you how do you navigate this as a as a manager of portfolios? I'm glad you asked that question because I was thinking about this conversation I had with someone yesterday that they just asked me in a a a very interesting question in a different manner. I get it asked a lot of the times and they said hey you know we want to know as an introductory call we want to know kind of what your philosophy is if we're on the same page said you know we do not believe the environment that we're in is unsust is sustainable but we can't develop a picture of what the future's actually going to look like and where the opportunities are. So they're like how do you deal with that and I'm like well you deal with it by being adaptable and you have to have a mindset. Now, we're fortunate because of the individuals that that built the basis of our strategy had to navigate the 1970s and the 1980s. So, they had massive change from the inflation of the 70s to the outsourcing of the '9s and massive adaptation. Well, in the mid1 1990s when Vanguard and Fidelity kind of came on and started pushing the passive investing, that adaptability is gone. Okay? and government actions have further driven money into that passive the US is the only place to be and overweighted. Now hindsight we can look in the review mirror all of those forces Mike Greens talked about how it's distorted and it has made the passive investing in the US markets really the only game in town especially since 200 uh [clears throat] uh January 1st 2008. All the [snorts] major indexes are are flat. So, how do we deal with that? One, you have to be open-minded from the standpoint that investments are tools. Okay? And this is the best analogy that I can give. If you're a really good mechanic, you've got a massive amount of money that's put into your toolbox. Okay? And I I I stole this analogy from from a a client that is a mechanic that was telling me about one tool he had. It was like a $5,000 tool, but he only used it once a year. and he said, "That thing's paid for itself time and time and time again because when I need that tool, it is the most valuable tool that I have in the toolbox." So remember, investments, Wall Street's going to tell you, be passive, okay? Just just be passive. In other words, trust us. We'll make sure that you're going to be okay while while everything's going not taking into consideration the forces that have have benefited passive, which are going to go in another direction at some point in the future. Mike Green's done a good job of explaining that. So uh so from our standpoint, you watch money flow, you have tools, you have all these things that you're following and you make adaptations. I won't have one asset class outside of an immoral asset class, right? There there are certain that are just absolutely immoral that that I I won't touch and clients don't want to touch them. But [snorts] gold, for example, Wall Street doesn't want to touch it. But since it since we got a buy signal back in 2016, that's been one of the single best tools that you could use in your portfolio to help protect your purchasing power from this inflationary pressures that come along. Silver, some of those others. There's going to be a time in the future where maybe a foreign currency, I mean, we've only used foreign currency in our main strategy for nine months since 2004, but during that nine-month period of time, it was the single most valuable tool that we had in our arsenal. So, so that adaptability and having a strategy that helps keep those emotions in check because here, look, I've done this for 28 years. I still feel the emotions when you have a big shift. When we sold some asset classes before, it's very popular out there. That's a scary thing to do because you don't want to be wrong with your clients. But when you have a strategy that tells you the opportunity is elsewhere, you place that tool back in the toolbox and you pull the other one out to help you implement. So another analogy that I I can utilize from that is we want to run a marathon with a relay marathon because instead of just one asset that's going to use us all the way from that period, there are in hindsight and there will be some assets that are perfect to sit on the shelf for 20 or 30 years. But in a a period of time where you have this massive change that's taking place globally, you've got markets that are US markets specifically that are ridiculously overvalued. You got to have a strategy that's going to tell you when to exit a particular strategy. Understand it's not going to be perfect in timing. But you've got tools that can increase your probability of success of being in the right place when that shift takes place. and also have tools that'll tell you you might be there for 12 or 15 months, but you got to go back to where you were before. So that adaptability, I believe, is going to be unbelievably important over the next 10 to 15 years because when we look in hindsight, you can see all the strengths of passive investing. Most investors look in hindsight and they try to project that into the future. It's called a hindsight bias. You know, if things have been really bad for you for the past three years in your life, you assume you have a natural tendency to assume they're going to be really bad for the next three years. If they've been really good, you assume that they're going to be really good for the next three years. So that adaptability is very important. It takes courage. It takes discipline and it takes putting your emotions, the greed, the fear and everything in check and navigate through that environment. And you know, and in reality, dance as best you can through the streets while Rome Rome's burning to the ground. I mean, you're still going to fear those emotions, but the resources that you have accumulated through over your throughout your life to be a prudent prudent management and responsible with those uh is very important. So, it's adaptability. is the willingness to go outside your comfort zone for asset classes that w that Wall Street and their what is it they call it your uh somebody had a perfect term you know your financial porn media that's a horrible term but it does a good job about just explaining how it's telling you what you want to hear seeking information that is not necessarily what you want to hear but what you need to hear and pursuing wisdom so that's that's how we do it is having that adaptability From 2004 until 2012, our portfolios were a completely different allocation than what they've been since 2012 up until here recently. Really heavy commodities, really heavy international during that period of time while the US markets were struggling. Those assets were outperforming and then uh over the past 10 years really outside of the past two when commodities kind of came in there, you really overweight US equities. So we have to be adaptable. There's an equalization taking place within the world. The east is rising and the west is kind of dropping. There's going to be massive opportunities there. So I have to tell clients from time to time, you know, set those emotions down. Take all of the perceptions that you've had over the past 20 or 30 years and understand you've got to make as prudent, adaptable decisions with your funds as you can. You can't time the market perfectly, but you can maneuver in a position when that big ball of money starts moving around the world because the reason it's so important to me in money flow and that shows, you know, from a technical standpoint and price action, the big institutions know more than we do. Okay? So when they start moving, we can look back in hindsight and see, you know, central banks were moving into gold heavily starting around 2016 after selling everything they had coming into early 2000s. They know where things are going. And if we're paying attention to that, not just being sold some product or told what we want to hear, then we can make those adaptations and pull those tools out of the toolbox and implement them in the portfolio until it's time to use another tool. So, so that's that's how we do it. The most simple explanation that I can give in the term of analogy is the adaptability and be curious. Be curious, courageous, and love the truth more than anything else because there's going to be perceptions. There may be a time, you know, when we use currencies over that period of time. We had the Canadian dollar in there because it was resourceheavy. We had the Australian dollar in there and we had the euro. Now, the euro made a lot of people feel uncomfortable until it did really good over that period of time. And then by the time it felt good, our tools were telling us to go somewhere else. So that discipline and the love of truth because if we love the truth more than we love what we want to hear, then you're going to drop the veil of your perceptions and be able to see the future clear more clearly. So that's that's the basis of everything that we do for clients really is just be adaptive, love the truth, be disciplined and courageous. >> Very good investment. You know, you know this, Chris, no good investment takes courage. It's easy to go buy Nvidia right now when when everybody's talking about how it's going to get you rich. It was really hard to buy Nvidia when you know after it had had some major declines in the past. So, so typically the investments that that make you the most uncomfortable to purchase. I mean, how uncomfortable was it compared to cocktail parties to be to tell people you were overweight precious metals at some point in the past, you know, 15, 20 years. They look at you like you got horns coming out of your head. That's that courage and love of truth and the love of what the numbers and reality tells you. That love of truth will keep you from believing the propaganda and the narratives and help you manage your funds more more prudently and wisely. I said prudent like 5,000 times, guys. Sorry. >> Well, it's important word. I mean, you got to know when to hold them and you got to know when to fold them, right? There's an exit and an entry to everything. And so, first time in my uh in decades I'm having honest question, honest discussions about what is an appropriate exit strategy for silver, right? There will be one at some point in time. I'm not there yet, but I'm starting to have the conversation. It wasn't even on my radar to have that conversation. And but now I can begin to imagine that I'm going to have to have pre-thought that through because as we mentioned before, the hardest time to sell my silver is going to be when everybody wants it. And you'd be a fool to let go of a single ounce. That's going to be hard, but that's why you got to I have to have a plan, not emotions about this. And um it's just yeah, it's the way of the world. >> That's right. And and sometimes it's going to be easy. You know, if you go back to when did gold uh peak in 1982, I think it was 81 or 82. Was it earlier than that? >> It was 88. Yeah. January. Yeah. Somewhere in that zone. >> Yeah. Somewhere in my archives I have the chart, but but at that time the value of gold outstanding was worth 125% of the US of the dollars in circulation. So, it had become overvalued. There's going to be a time in the future where it's going to be clear in hindsight that we should have sold silver or gold at that point, but you've got to be looking for those. And there will be signs. One's going to be every retail person in the world and every taxi driver that you run into or Uber drivers going to be talking about how great silver has been and and and picturing this future. That's going to be one sign. The second thing is is understanding I'm not going to pick the top. I just need to get close. Okay? I'm not gonna pick the top. And and and if you've done it right, you're still going to leave a little bit there or you're going to capture on the other side of it. You're only going to know in hindsight. But that's why strategy is important. That's why diversification is important. And um and that's what we help people do is help navigate for those that don't enjoy doing it themselves because if you don't enjoy it, you're not going to do the research that you need to do to be prudent and effective for you. So those are the first people that we do this for. The second people that we do this for is recognize that they don't like doing it and they don't want that responsibility but they can't find somebody that they can trust that can articulate and communic uh clearly communicate why they'll sell while the why they'll buy and how they'll make adaptations because most of the people that I'm running into just don't you know the passive thing at this point in the cycle just doesn't make sense to them. It just doesn't make sense. And and quite frankly, there are very few people out there that are doing anything besides passive cookie cutter modern portfolio theory approach. We are a rare breed now. And I did not realize how rare until the past two two and a half years. Most of your industry is is really predicated on the rearview mirror. Hey, let me tell you what's worked for the past 20 years. leaving I we you and I could make a case for maybe additional caution just based on the how expensive the markets are just on that one feature. We could probably make an equally strong argument just on how disruptive AI is likely to be that the past is not likely to be a good guide for the future. We're going to have to be really thoughtful. We're going to have to take our best guesses and we're going to have to adjust quickly when we get it wrong because it's moving too fast. Right? So, but everybody's sort of glued to the past. Um, by definition, you're making the wrong choices when when things change, right? You know, it's like driving driving in the rearview mirror is fine when you're in Kansas. It doesn't work so good in Colorado, you know. Um, >> no. No. And and and another analogy, if you have no sales strategy, you have no nothing that's going to cause you to lower risk in that portfolio. Not only are you driving in the rearview mirror, you have no brakes on the car, right? You have no brakes on the car. And and everybody understands that, yeah, you can run a red light and have no consequences happen. You might not get t-boned by a transfer truck and you might not get pulled over by a cop and and but you but if you're driving from here to California and running every red light and stop sign you come through, it's highly unlikely that you're going to end up there without a catastrophic event. But that's what Wall Street does and that's what we've come to in the modern investment world is it doesn't matter if there's three nukes in the air. They're not going to sell. And if they do sell, it's an emotional decision because they don't have a strategy to tell them when to sell. And if they don't have a strategy that tells them when to sell, they certainly don't have a strategy that tells them when to buy. So the only thing that they're relying on is passively leave it there. Let's stick our fingers in our ears and close our eyes and let's hope it works out. Or emotions take over. And guess what they do? They sell everything at the bottom of the market in 2009 after going all in the market at the top of the market in 2007. That's that's what our emotions do to us. And guys, I'm telling you, it's my 28th year doing this. I've seen every mistake that people can make because most of them have come in and tried to help us help them recover from those. Okay. So, so you know, you get a little cynical. I remember when I first started in the career, I looked at all the the older, wiser guys that I went and learned from and I wanted to seek them out and I was like, why are these guys so cynical and they've been in the game long enough to understand >> y >> that, you know, you can be oblivious and it's really fun until you get hit in the mouth with a baseball bat. And and just looking back since the year 2000, 47% decline in the market when the a technology bubble burst. 2008, housing blew up. Well, the stock market wasn't that overvalued at the time, but you look at where we are. We're a combination of the 2000 uh technology bubble in valuations, a market bubble in valuations, and housing is overpriced at this point. And the demographics are not in the favor of housing over the next 15 to 20 years. So, we got here from a completely different launching point. And I don't understand why people outside of looking in the rearview mirror and Wall Street's desire just to tell people what they want to hear, we're at a completely different starting launching point now and is going to be much much harder to to repeat the same thing over the next 10 to 15 years. It might continue for another year or two. I could build the argument that that this market's going to have a blowoff top in 2026. And I'm watching, you know, us struggling at resistance. If we break out, maybe it carries another three months. Maybe it carries another six months. Maybe this administration kicks this can down the road into the midterms because they think that's going to help them. But but the next 10 years, I can just about with certainty say you're going to look back 10 years from now and you're going to see these other opportunities of what you should have done. And what gives us peace is we've got tools that will tell us when we need to make those adaptations. So that's how we kind of help help people navigate through it and and build them information, knowledge, and help them understand through our planning process what they can control, what they can't. And that brings peace of mind knowing that it's adaptive, their plan is prudent, and that they've taken into consideration all the things that can go wrong and you've built checks and balances in place to mitigate those risks before you walk into that journey. That's what wisdom is. And for anybody who wants to u maybe speak with Paul after hearing that and or his team, please go to peakfinaniallinvesting.com. There's a very simple form you fill out there and within 48 business hours after receiving the that filled out form, somebody from Paul's office will contact you, arrange the first of what should be three separate meetings and an introductory phone call and then a planning meeting and then finally, if it goes to that part, recommendations. And so that's the process. And that's even before anybody's agreed to work with anybody. It's it's part of the process and and the value [music] that Paul offers to the world. So Paul, thank you so much for doing that. Thanks for your time today. Happy New Year. >> It's my honor. Happy New Year to you too as well, Chris. For all the listeners and your family, may 2026 be full of wisdom and blessing [music] and peace for all of you. >> Bye for now, everyone.