Breaking the Code of History, with David Murrin | The Southbank Interviews

Summary

• Macro Outlook: The guest forecasts the end of a multi-asset Doomsday bubble with simultaneous declines in U.S. equities, bonds, and the dollar as reserve status erodes.
• Precious Metals: Gold and silver are highlighted as primary wealth preservers set to “wake up” now, with potential for substantial multi-year upside amid stagflation.
• Commodity Supercycle: A powerful commodity inflation spike is expected into the 2025–27 window; a near-term retracement could create 6–9 month entry opportunities.
• Currencies: Sterling is pitched as the preferred safe-haven currency, while a major dollar decline is anticipated after a final countertrend rally.
• Defense Spending: Significant rearmament needs in the UK and among allies (e.g., AUKUS) imply structural support for Aerospace & Defense within Industrials.
• United Kingdom: The UK is framed as the most investable Western market due to political energy, global posture, and currency strength despite near-term volatility.
• Stagflation: A multi-year stagflationary regime is expected, favoring hard assets and real-return exposures over traditional financial assets.
• Supply Chains: Strategic supply reshoring and manufacturing automation away from China are emphasized as critical and investable long-term shifts.

Transcript

hello there my name is Bo Shan I'm an editor here at South Bank investment research now a couple of weeks ago a colleague of mine told me about a book called breaking the code of History by David maren I was quite intrigued by the premise of the book and decided I'd get a copy of it myself now I was so fascinated by the contents of this and the models for understanding history and the future I became determined to get David maren himself into our studio for a conversation with him because he does have some very fascinating ideas he's got quite a career quite a CV behind him he was exploring the jungles of Papa New Guinea and the pacif cars a while ago working in oil exploration before he started trading at a Wall Street bank and then setting up his own investment firm his own hedge fund where he used his models for understanding Society geopolitics and markets in order to make returns for himself and for his investors now he does have some very radical ideas about the future which I'd love to discuss with them and I hope you find the next hour interesting we'll see you at the end David thank you so much for joining me pleasure to be here boys now David before we get into some of your models for predicting uh the future and indeed how how successfully they've predicted the past I'd like to dive in uh to some some of your very bold predictions about the future specifically regarding World War III uh the status of the dollar as a global Reserve currency and you the UK's place in the future big start then uh well basically part of my thesis is a five-stage of Empire model which um in 2002 when I created it implied and predicted that America was in ter decline the fifth stage and highlighted that Journey towards Decline and at the same time it highlighted that China was the second of the Asian super Empires and was in expansion and it would move into the Gap aggressively to create a hegemonic challenge as it did and sequentially the peak of that hegemonic challenge will come with the next commodity cycle peak in 2025 to 27 and Wars are not fought idealistically they're fought over resources and commodity resource spikes are the the in effect the drum beat of conflict so my conclusion back then was these two systems would rise to equality there would be hegemonic Challenge and the great risk for conflict global conflict would be 2025 maybe slightly early from 24 to 27 and somewhere in that band we would have a human systems threat of World War III unless certain steps were taken and those steps really result in in deterrence so recognizing where China is which it has a time frame for its Gonic challenge to be completed by 2030 much earlier than people realize because of its negative demographics and because of the rise of India and India representing the same strategic threat as Russia did to Germany twice as in it forced the timing of when Germany acted and went to war in 14 and 3940 and and obviously invading Russia India has the same role so the conclusion is that she understands that time frame and he knows what he's doing and part of that process for the the Chinese was to dup the West into thinking that if we invested in their capital structure we gave them the things that we value they would be like us and it's amazing how many people don't really understand how deng's plan was to do that and they're now in a different phase which is they don't need us to invest in them in fact they're busy chopping off every Investor's fingers quietly at the moment because they've shifted to another model which is much like the Nazi 4-year plan an internally fueled consumer society that militarizes and starts its road to an accelerated point of conflict uh all of which we've seen evolve in the past year or so so we've got a very sleepy West um yes Biden's focusing on China but he's not doing the things that require us to combat them which is a full isolation and Iron Curtain type structure new Supply chains that are away from China new Manufacturing Systems all those things urgently needed and very large investments in the appropriate military responses the failure to create a proper Navy plan US Navy plan in his administration is really concerning because the US Navy is the Frontline in containment so there are many signals that Biden's are Biden is giving and in that process that's really key is all the great conflicts before have had things called pilot Wars and those pilot Wars are these little conflicts and no one notices like the B war was to Britain and in South Africa and to Germany that was in hegemonic early phase shall we challenge mode watching us fail to bring the the bore Farmers to Brook over a period of years and taking 500,000 English soldiers to do it was a sign of weakness and that begat the arms race when the dreadn was launched and the whole thing came about because it was really a failed pilot war in the time it took to prosecute and be successful if you look at the Spanish Civil War it was a similar pilot War it sort of represented that the Britain and France just left Spain to its own devices let the Communists fight with the Nazis or the you know the fascists and they just left it that was a sign of weakness and certainly a failure to push Germany out of the r when they moved into the Rin lands in March 36 was a massive signal and conversely a positive example was the fkin war the Faulkland War changed the perspective of the Kremlin the capitalists were weak and one day their large army would roll into Europe and essentially capitalism would fall and suddenly this thing called Britain under Thatcher that had nuclear weapons went 8,000 miles and determinately fought for its territory and it irrevocably changed their perspective in the use of force and that's why the Cold War stayed cold a positive out come right and today we have a failed war in Iraq a failed war in Libya Syria and now this precipitous withdraw from Afghanistan and they are red flags to a to a bull she is sitting there thinking I'm going to carve up you know I'm going to do exactly what I plan to do so unless we wake up to the threat we face then that increases the inevitability of the attempt by China when the commodity cycle really goes into overdrive to make its move the withdrawal from Afghanistan is of course making the US look particularly bad in that particular pilot War though the Middle East in general is littered with military failur uh and at the same time you have social unrest at home because unhappy with the conflict as a whole looking on how this reflects on the US as its you know in its Imperial uh status and as you described an imperial status of decline how does that uh play into markets when you're looking at the value of the US dollar and its status as Global Reserve currency well HED ones you know at their Peak seem Untouchable and if you go back to you know the '90s 2000 the Cold War had been vanquished unipolarity and we lived in a world of a unipolar world no one could ever imagine that America wasn't going to be at the top of that tree so of course it could borrow from whoever it wanted it could do what it wanted and it had to go through a series of financial reversals to start to make the cracks where exactly what happens in Decline which is it starts to move from a competitive economy to a to to reduce competitive economy with more leverage so you know let's just have a guess you know 2003 we'll leverage ourselves three times and then we're going to look healthy bottom of 2008 well you know we'll leverage ourselves 10 times and now that looks healthy and by the end of the pandemic let's leverage those 40 times and look healthy and anyone who understands what a leverage portfolio does it looks really healthy if you got like 0.1% growth and 40 times The Leverage because you make four 40 units or four say 4 % a month and suddenly you don't because the 0.1 goes to zero and nothing thing disappears and that's exactly where America is this highly leverage system that people think is healthy but is not healthy and the speed at which the shift is going to take place I think is going to shock everyone the erosion of the dollar has been going on for quite a while and in fact this next the the move that we are seeing at the moment is we've had one move down since those March 2020 lows we're in a counter Trend move at the moment which all markets do they don't go in a straight line and as risk comes off we'll see that counter Trend movement reach its conclusion and Peak and then I think after that somewhere in the next three months when that Peak is made then we're going to start to move for a very very big dollar decline as America comes under pressure from all three of its asset classes Equity markets falling bonds falling and essentially the dollar falling because it's losing its Reserve status and I think that scenario is upon us within the next in 12 months considering how the dollar is used for commodity pricing and of course dollar denominated assets are seen somewhat as safe havens so we talk about us real estate and indeed US Stocks to some degree do you think what this dollar losing its value like that would lead to a rise in the in the in the price of those assets like for example some Commodities or real estate it's a bit more complicated than that imagine what's being created is this I call it this giant Super Bubble and it's the Doomsday bubble because at the end of it there's no way out and essentially so much money has been printed in the past 12 months that it's gone everywhere into all aspects and so people talk about the housing bubble but the housing bubbles going Lumbers already had its cycle you know it went right to a Peak High no one sported it my work allow me to predict the high and it collaps any 60% from that high that means that the property asset cycle in the states is super vulnerable and just waiting to fall like everything else we've seen it move into cryptocurrencies which are RAR a response to The the Reserve state has gradually been lost or this sort of unconscious recognition it will be lost and trying to fill the Gap and ex exact exactly right what do you do when you lose the dollar it's the beginning of that process well it has all sorts of flaws and it's also created a sub bubble which I think is going to work its way out of the system before it becomes actually like gold and silver possibly another whole surge but we go down before we go up as the whole implosion takes place so you can see all the pieces in puzzle already and the other piece of the puzzle is rates and essentially this zero rate environment is now on the move towards a much higher rate environment and we've got two things happening we've got systematic inflation which has been suppressed and a lot of that you know when we should have seen inflation the past 20 years we have cheap manufacturing from China I think with this cold war Dynamic accelerating we have to Discount the fact that that's not going to happen and we're going have to find other cheap manufacturing sources and it's going to be expensive in the transition yes that's a structural problem that we know people should be addressing and leaders should be addressing right now for America Mexico is the natural in fact really for the First World countries they should be thinking about automated factories if they're talking about infrastructural investment it's to produce internal manufacturing that doesn't require Transportation doesn't expose you to your supply chains being cut off in times of conflict or constricted in places like pic exactly the SE can you build things where you start it's green and also gives you control of your manufacturing base so I think this sort of the there is a whole revolution in the generation of new factories that build multitudes of things at the same time and there should be a big focus on that but before we've got this big gap between what was made in China and where else do you make it so there's inflationary Dynamics from that there's the first surge of commodity inflation from the lows in 2020 which is wave one of the Surge and I think we are at the peak of it and when we have a our asset bubble claps which is imminent right now that will reduce demand and there will be a retracement but we shouldn't be uded in that case whereas you know assets like shares and houses will just keep going down those guys represent core investment opportunities in six to9 months time not now because over five years I think commodity inflation is going to be unbelievable and to give you some idea of the previous conflict relationships with the commodity cycle Peak y 1914 World War I was the peak or the the peak of a commodity cycle so no one talks about the fact that actually that war was about resources and the price of resources that triggered the actions the next cycle Peak was 75 and in 75 you had a cold war Paradigm you had a consumer Society in the west head on with a commodity producing Society Russia and of course their system looked economically incredibly viable in 1975 because they were producing Commodities that were really valuable and consumer Society was doubly nobbled because it put input inflation then drag on their economies and psychologically we were losing in 75 we know we it was winable war and so that was interesting because you had a producer matched off against a consumer and the spike wasn't as big as 14 on a relative basis but the one in 25 you have two consumer societies head-to-head and you have Russia on the side deciding which way it goes which is another conversation so I think this commodity price INF inflation spike is going to be like nothing we've seen before yeah to give maybe maybe an idea of how high you think Commodities could go in you know in the next few years for example I mean how extreme do you think it might might be when you have those two consumer Empires on either side of the planet by 2025 I mean levels that really are difficult to even imagine doing about gold you know gold within its inflation Dynamics 10 times higher than it is now five times I mean multiples silver you know $100 you're talking about things that things that are really difficult to comprehend but that's what happens at the end you end up with this super whoh it's exponential who could imagine where US Stocks got to and if you were back 10 years ago it's the same whoosh that takes place right in that final surge so that final surge is going to be hugely challenging and for a western economy a big problem because you know this sort of incremental growth model with low interest rates that you know kept sort of how can you call it an intensive care unit keeping an old person alive and Europe is especially like that and America's become like that the only opportunity is to create a high growth highly Innovative economy and the only country in Europe or in the west that can do that is Britain and there's a decision that has to be made swiftly by our government in terms of what type of economy can survive a stagflationary environment and there is only one it's a high growth low tax regime and it isn't a question of the preference of whether you believe in low taxes whether you think it's morally right whether you get revoted there is only one survival strategy available as St flal consumes the Western World and that is low tax High investment regimes with with high Innovation now this brings us to Britain we have uh spoken we have referred to your five stages of Empire previously at this point I'd like to you to you know give us a little crash course on what the five stages are and then we can speak about br's place in it because I you didn't slip if you're American um um okay so so essentially I think that all living things have fractal Dynamics so the best way to describe the five stages of a human system which can be an individual it can be an Empire can be a nation could be all manner of identities with a defined border of collective behavioral patterns are that you are born as we you you or I were fairly helpless and on the measure of energy and wisdom we were're pretty low on the count and somewhere in your curve you'll go up and there will be a peak and you'll wake up one day and that day is your peak of your wisdom and your energy combined and you have no idea what ever happened you carry on for a bit in denial as you slip down the curve and somewhere at the end of the peak if you have the privilege of getting to the end of it without you know some truncated event essentially you wake up and as an old person you lose your energy and you lose your wisdom you can't remember and you're at the back of the beginning that cycle just stuck in my mind and that's essentially the cycle of a system so the first stage of a system is what I call regionalization expanding demographics and demographics are like an age like counter so with expanding demographics the system needs more organization and normally as it expands from some base unit the people at the top at that stage are narrowly enfranchised the people who are demographically expanded the bottom are quite poor and unrecognized and these people at the top are tend to be Collective thinkers and they tend to be you know epitomization that it's a left brain thought process iterative controlling what because they have the whole system in their hands and then the bottom Rises up and says we want more and a civil war takes place and that Civil War allows the facility of a right brained sort of um individualistic Maverick anti-entropy thought process which invariably beats the inran iterative process in a civil war that historically has always been pretty bloody and by the end of it you end up with a right brain system led by right brain people who have gone through an entropic experience of conflict and therefore they're not there by accident there because they're highly capable and they share the collective values of the system and the systems militarized and it literally rushes out into the second phase runs down its resource chains militarizes its resource chains starts to dominate the systems around it with an algorithmic process of I dominate you my neighbor now I'm two units I I get to my next neighbor it takes me a third of the time my next neighbor a fifth of the time and it creates an exponential process of expansion and then you get to the peak of expansion where you can't go any further and you finish the expansion phase and you start to establish your system because now it starts to fill in in the gaps on the interior and that's maturity and maturity you start to see something else happen those Mavericks at the built system get displaced as the system becomes more stable by the more iterative thinkers who were there at the bottom of the cycle and they start to become more Pol iCal and more iterative because they don't need to be leral because every day is fairly similar and the resources of the system allow them to overcome the challenges so then you reach the peak of the system and at the peak of the system there's another civil war and that Civil War is a subtle shift or a less subtle shift between the right brained L individualistic people that built the system collectively and a more iterative process that now want to run the system that's stable and that's actually the beginning of decline because creativity is slowly being removed from the system under knowingly even though it seems to dominate its whole environment at that stage the system is highly tolerant highly integrative multi-religious all sorts of things happen and all systems do the same things until they start to roll over the top and one day they start to move into overextension they no longer earn as much as they spend they no longer create as much as depleted from the system it's an over extented Dynamic but only to the perceptive can you start to see it but it's a Hallmark of less and less Maverick people sit at the top most of them are just retired out as irritants and they know removed from the system until you get to this moment of Decline and the moment of decline is some kind of definitive reverse for America it was 911 America turned to something it wasn't after 911 everyone everything the terrorists describe America as beforehand you would have said maybe bit extreme don't agree with it afterwards two years later it became that entity and most importantly it lost its moral imperative to rule once you lose your moral imperative to rule through rendition and torture the very values that you as spoused you couldn't do everything else starts to fall underneath and so you know the things that happened were you America was subverted by NE neocons that basically didn't understand the application of power what it really meant and they bust the system by overextending it and and further pushing it into fall and then narcistic leadership is common at that stage the whole system moves from one of service and I serve the system and the system Rises on the service culture to I am now more important than the system and NASA system in leadership and Nas Society just increases and the system just starts to break apart as it borrows more becomes less creative and all the things we've seen in America particularly that cycle when I wrote the book breaking the code of History I made the assumption that America Britain and Europe were all collectively as part of the what I call the super Western Christian Empire inter terminal decline but I Creed some bell measures and some sort of intelligence mechanisms to become alert to systems that were changing and my favorite one was Olympic gold medals yep and so sport is not just sport sport is a ramification of um a national energy this system people collectively have energy and the nation has energy and it's competitiveness and ability to organize its competitive mechanisms and to fund them appropriately with the goal of winning so you don't just happen to win you win because the system has a large amount of national energy and you can see the rise of America through the medal table you can see the rise of Nazi Germany as it appeared you can certainly see the rise of USSR in the Cold War and you could see China coming through its metal trajectory ahead of time ahead of time and then all of a sudden there was Britain number three and I must admit as an Englishman that was brought up to always look in the room and think go aren't we useless you know how many things do we up it was a really fascinating moment to think hang on that's really one of my signals and it's happening to us what does it mean and then of course we came second and that wasn't just a random moment it was a pattern of national energy that came about through Major's National Lottery vision and all the things that go with it yes you can bring them down to moments and people and decisions but it represented a collective energy and in this one for example although we were slightly less placed it was very obvious that the system that was once created through Lottery dispersion of money was starting to become a bit more abundant its performance but there were individuals in sports people in lateral games that were now coming to the top so it's an example of the whole system manifesting aspiration look at inos you know inos is a product of you know three people's incredible success and we are right up there finally for the America's Cup third time round which requires money perseverance and wealth it's all over the place and yes we sort of didn't quite get there in the European football championship we didn't quite get there in rugby but we're really in so many sports right up there that our national energy is unassailable and that manifest in all sorts of other aspects and that's when I realized that actually we had troughed in 79 thater was the kickstar and turning point and essentially that brexit represented our civil war and so the moment the referendum was called I knew which way it was going to go I really had a strong I wrote about it at the time talked about what it really represented the processes it would go through and how we would come out the other side saw Boris a long way out as the only possible person with the energy the system would require and really talk everyone through every step although it seemed illogical to to people it was highly logical using this code to understand human systems you do hear an awful lot uh about sort of the decline of Britain these days you get for many journalists for example at the ft and you know plenty other papers who who write a lot saying you know Britain this is this is a vain glorious attempt to resurrect the uh the Glory Days of Empire and it's very it's not very patriotic but what you're describing is almost like a a new cyc of Empire effectively that we've managed to to get back into we are in the second stage of our cycle and you know when the word Global Britain was Co I almost fell off my chair with laughter because Global Britain when when you write those if you read you know you've read the book but you look at the stages of the second stages of Empire everything in those stages are manifest in the vision of global Britain apart from one thing the appropriate militarization to support that expansion and the reason why I think we we've been through this process that's a little bit more complex than other transitions between regionalization and expansion to Empire is in every other system Warfare and Civil War meant that the really did from the top down shifted from a left brain Collective process of iteration to a more Maverick individualistic thought process with with a whole Cascade of people with that mindset from the top all the way through government to military leaders which is incredibly powerful to give you an idea that the greatest generational war machine that epitomized that value set was Nelson's Navy they were all of the mindset captains first li tenants the whole Navy was structured because of the environment of the sea to actually favor that thought process and it was absolutely Unstoppable so when you what we haven't really done and thank goodness we didn't do it was we didn't kill each other over it it felt at times that we might and it had all the energies of it and you know between friends that fell out and all sorts of family members that just wouldn't talk over the table it was a big thing what was quite remarkable is that our construct of democracy held the one of the most powerful social changes a system can go through and now we have gone back together again better than you could ever imagine under any circumstances but the downside which we need to consciously manage is we didn't complete the transition we completed the change at the top with boros and his cabinet and the vision and the manifestation of global Britain all of those things are commensurate with that Evolution but government heads of businesses all of the people that sit around the institutions have been left untouched and the issue there is Cummings represented that energy of change and in many ways he was you know right about the need for change but his concept of implementation was so egregious and so dare I say it emotionally driven rather than logical and constructive and and smart in the way he applied it that the institutions with the other mindset were able to cast him off and now he's cast off there's no replication for that energy that we need so desperately so our leadership is compromised by institutions don't think the same way they think in opposition they don't think and they don't see the number of surprises we've had over the past few years is because they are epitomize the lateral thinking required for strategic planning so we still haven't completed that change and we need to consciously understand the great credit we have through getting through it without the blood letting but at the same time now engineering those changes as swiftly as possible using this social construct which I describe which allow us to liberate our energy more effectively what you know what form would that take if you're looking for you know the ideal way in which that uh that change could take place what would it require well I I think I think it needs exterior advisors and there are an awful lot of exterior advisors that come from the old mindset but you need exterior advisers and not part of a system that think laterally that can start to challenge the and and review the ministry of defense for example it's just not fit for purpose at a time when it should be it doesn't and cannot do the things it's meant to do so when chur will face that in you know in the war he created alternative organizations and he used the alternative organizations to move faster while trying to create change more slowly in the in the larger institutions that were the bodies that the government used so when if I was you know advising Boris I would say you need two parts to this you need you know a very very quick footed strategic thought process group that really is founded in competency rather than just some traditional I am and you start to change policy from that level and you change it underneath with radical reform inside groups but they need to come from right brained you know individualistic reformers that are grounded in knowledge rather than just ego to enact both sides of the sausage and we need it yesterday uh now looking at you know the need for militarization uh I'm sure plenty of people would say well why why would we need to spend all of this money on you know new uh Royal Navy carriers and new dreadnots uh this is often seen by people as you know a big big waste of time unproductive capital expenditure why is it then that Britain needs to remilitarize what is what threat does Britain need to face off against so so we Face we face on the traditional enemy of Russia and and Russia is about to become very wealthy through this next commodity cycle so just if you had a single polar world with Russia and Europe how we cope with Russia is a critical part of it and rment has to be the only solution if we could have worked with Stalin as we did do by need to to to combat Germany in the second world war Putin isn't staling he's a far lesser version he's tricky he's difficult there are lots of things which are in opposition to the concepts of democracy but actually Repro now is strategically the only route because he faces a problem too he doesn't want to be the only country sitting next to his ally potentially China in the future see the West disappear and know he's next because he will be so he sits just like Stalin did on a knife edge between the West that he despised because of the capitalist and the Nazis that he doubly despised because they're his neighbors and and even more so in many degrees and he made that compromise Putin faces a very similar process and Western politicians have to wake up to that that now is the time because as the commodity cycle reicks then there's no way he's coming back he's alienated and his pride is well and truly pricked after the way the West treated the fall of Russia which was Despicable to be honest he has some you know rights in saying that so we have to have really like the the repman that Britain made with France in 1906 recognizing Germany was the Continental power to contain we need something like The onon Cordial and we need to really understand how to do that um so that's the first part um but you cannot do it from weakness and so if Putin sees weakness you'll never get him to the table the only way you'll get him to the table is when he sees absolute strength that he cannot push through and the only way we can do that is to is more money on defense and for example his submarine force is just growing and growing we cannot protect our own Waters in airspace easily there are submarines lurking in our Waters that shouldn't be there our deterrent is you is at risk there are whole parts of this which are embarrassing where our Navy is completely overstretched and we do not have the facilities to combat Russia alone in our Waters so that's the first piece and especially as Russia has invested in six core strategic weapons which all of which are scarily pieces of kit that we don't have counters for so we've been caught napping in effect so we need it for that reason but even if we could create the Repro with Russia and we can only do that from strength and not we're building them in 10 years they're in the water and they're doing their job strength China is a much bigger systematic issue China's been in expansion since the boxer Revolution um it is the second of the Asian Empires the first was Japan so we have already between a western super Empire and an Asian super Empire we've already seen the conflicts that started for example with Russia and Japan and that was the beginning of it you know in the in that particular conflict and the Japanese were successful note um and so China has been working in a strategic way that's difficult for westerners to comprehend I've spent 35 years studying Chinese martial arts they are the most sophisticated cunning devious thinkers perhaps on a k of Britain when it gets mobilized but in the western world but we're not mobilized at the moment and so essentially they running rings around us they encourag the West to invest in their own demise we still have politicians and businessmen who think they can invest in China and make money and they are selling their children's future which incidentally took place in Germany and twice there were Pro Germans into 1914 lordy George led the charge he obfuscated the British respons as a respon actually he encouraged aggression from Germany because Lord George's perspective was perceived by the Kaiser as one that would keep Britain out of the war when they invaded France but they made the mistake of going through Belgium so we've had this before people who are blind to aggression who see commercial advantage and portray their own societies and we do need people to stand up and actually say that's not appropriate anymore this there is a real threat and you know we've seen threat I mean if you go back and say how do we not catch Germany oh well let's think about it they had concentration camps y well we ignored that we just tick yeah they've managed to Annex countries around them oh tick that's Hong Kong they managed to subject their culture on the countries that they've Tibet Hong Kong their whole Independence system has disappeared anyone who's an individual is in prison or disappeared it's terrifying it's happening all over again and yet we're happy to go and buy a Chinese model or you know everything from China so we need to wake up to that threat and understand that the Chinese will only be deterred by strength because they will move if there's an opportunity and they won't move if there's deterrence so our strength comes through deterrence and we need to wake up and make sure that happens and in a world where America is weakening America because like this old powerful man that's now in a Zimmer frame with you know lots of money and lots of influence but doesn't use it wisely Britain is is the energy that can Shore that up but we need the intention and the Manifest to do it and and what people don't realize is global Britain has set us head-to-head with the Chinese because the Chinese are expansive and Britain is now expansive in global so whether we like it or not we're going head-to-head with the Chinese we can't avoid it and we need to prepare for it and where is China in the the stages of Empire cycle now would you say so China is is well and truly its expansionary second stage started in about 96 and the evidence of a 50-year plan of expanding underneath the umbrella of American power is overwhelming and it was a dam cunning plan you know started off by making them look like us which they've done build a manufacturing base like like us now they're the manufacturing base of the world and they destroyed our manufacturing base in the process all of those things were part of their plan the only thing that's changed which is interesting is that I think if Deng woke up he would have said to she oh you stuck your neck out too early and she stuck his neck out for a number of reasons one is he's a very very aggressive capable leader brought up under a father who was you know close to Mal kicked out um he knows there was only one thing you can do to ensure your survival in the Communist party and that sit at the top of it ruthlessly so he has committed to that path and he sees the same for China as an extension of his own perspective for his own Survival so when Obama was his opposition and Obama represented and I said this at the time you know Obama was the absolutely classic president of decline he came from the underclasses because the demographic of the underclasses gave him the Electoral power to do so and people who rise from the underclasses whoever they are whatever their education whatever their race focus on the internal social dynamics rather than the maintenance of the borders of the Empire they always neglected and they were neglected and they imploded and she just moved into the space and he accelerated the mechanism you know from I would say 50 years to 30 years and the more that America withdrew the more they moved the more embolden they were the belt and Road system the whole process of colonialism through debt and control and manipulation all of those came under the Obama period Then Came Trump and Trump's was a response and predictable because essentially America gave too much power away too quickly and the unconscious electricity hang on a second make me great again and Trump just walked right into the phas and along he came with the promise of making them great problem is narcissists never make anyone great just themselves and that's fundamentally what he did he whatever he said he was going to do he didn't do it if he had delivered on it would be a different world but he didn't even his trade deal you know he ended up going to sh saying I need to be in power can you help me how do you combat someone when you're asking for their help to be reelected you can't but he did increase awareness of the threat to China although he didn't actually create the mechanism to push them back he did increase he started to create secondary polarization as I call it which is the response of the hgim that's been challenged to immune system response of saying what do we do how do we do it but he didn't actually deliver anything that he made it worse he destroyed allanis and relationships he destroyed the trust in this process of democracy himself and the capital RS with a personification of it so he just weakened the system not strengthened it and that's why Biden was able to walk in for two reasons one is essentially that America's becoming poorer which is another sh sign of De line and you end up with a few people who are wealthy through the printing of money and the bottom of the pyramid are just not helped so you end up with dislocations and Obama is a social I mean Biden is a socialist he's continued with the agenda but that's exactly what's happen socialism comes at the end of the system where you try and help everyone with your balance sheet it doesn't work and and Biden is the Callahan that we had that ended our decline process appallingly he is the same level of person and the problem is for America unless they the Republicans eject Trust another term of trump will finish America off without the Chinese so the question there is essentially can the Republican Party wake up sufficiently to enact a new form of leader it had to be a military leader with strategic knowledge so an admiral would probably be my preference because of their strategic understanding and that's the best survival route I can see through for America a military character Rising through the Republican Party removing the Trump ites and creating a system that can defend itself again even then that looks like it's a going to be a bit too late so it's it's a very tricky I can't quite see the The Roots out of it and and I think Britain's role in waking up is an important role because America might just not be able to do the things it really needs to do unless it has some weapons in Area 51 of course or you know some black programs that we don't know about which is entirely possible although I suspect not to definitively change the balance so in the in the event you got someone like I don't know Dan cren or somebody from the Republican party ends up becoming uh the president of the US you still think it would be a managed decline stage for America so one of the interesting things so we have a life cycle we're born and we die the options we have extend our life they extend our quality of life they extend basically you know what we'd really like is a is a long curve and then bang that would be ideal for existance but we are going to die and America is going to die as a system that's dominant the what's interesting is Britain rejuvenated itself with its old structure and the speed of Rejuvenation is surprising historically so the question is can America preserve enough of its constructs to allow something else to come through I was really intrigued because I think film and the stories told in film Rec recognize social moods and behaviors and and they predict them in many ways and and resonate with them and I Isaac a azimoff's film Foundation which is for someone of my generation the foremost piece of Science Fiction you read about how do you basically when you know your civilization is falling create a covenant or an ark which allows the next one to rise more quickly and that's now on Apple TV which I think is extremely resonant right and so it comes back to the question of Britain actually is moving forward to hold the Baton of Western democracy and America will have to do what Britain did afterwards if we get through without conflict of live a period of reformation and you in effect the Phoenix can't rise without the ashes and I the only way you can break that cycle or change it is you create an offshoot of yourself as you move into Decline and something similar Rises which but the system itself like your son or your daughter is the same human Paradigm and Britain was the same with America as we declined our cin took over so one of those passings of the Baton is possible but I don't think that you can just suddenly circumvent the terminal phases and say oh we can just go straight to expansion again it's not possible I mean in the case of Britain it did happen pretty quickly I mean if you're going from late '70s is terminal Decline and then through to thater in the ' 80s it is I mean it's surprisingly quickly let's go back actually decline happened after the second world war and the peak of the the empire was 1914 before the war started that was truly our ultimate power at that stage and we gradually like rolled downwards even though after 1918 we end up with more the Middle East more land you know access to oil in fact decline was already setting in and decline of Empires takes time but for America that decline has been taking taking place since I would argue since 1990 so we're 30 years into that process into the terminal phases um and as the last of the Western Christian Empires it's even more vulnerable because it doesn't have another system like Britain coming up behind it well we are there but not enough but I think and therefore I think brexit's role is more interesting than just a group of people that decided they wanted to be sovereignly independent and respected democracy and they wanted to decide and break away from a morban Europe that had lost its creativity run by bureaucrats um I I I think actually it represents the desire of the great larger system to perpetuate democracy and freedom and if Britain had stayed part of Europe it would have been locked up and there would have been not a single element available to the super Christian Empire of to expand or reframe and Britain represents that offshoot to reframe of the system on that on that note with uh Europe uh and the UK we well the Euro Zone in particular and the UK breaking away from from the EU recently we have seen the French get embarrassed with their submarine deal with the Australians getting sort of stolen out from under their noses by the UK the US and with Australia of course and what do you think what do you think that story says because to me it does speak of a certain I mean of a certain uh you know strike back at China which is quite uh which I think is quite a masterstroke when it comes to nuclear submarines and what's your take on that because it doesn't speak me entirely of decline um well it's it's a really interesting piece because the Australians much as they were in the second were highly vulnerable sitting in south of of Japan and we often think about Midway as the turning point but the battle of the Coral Sea was the turning point when the Japanese invasion force of Australia was turned back right and and so Australia understands what it's like to be vulnerable down there in the South to an Asian power which is expanding towards you for your resources and your land access so they've been very very aware of their dual problem of economic dependence through resource exports to China and also China's aggress and to give them credit for 24 million people they are the only country that consistently calls China out over the pandemic's source everyone else has buttoned up but the Australians have been sitting there saying sorry we don't believe it's zootic and they have relentlessly done that and paid the price for it so if they were aware of the threat before they are super aware of the threat now because they've been threatened with nuclear war who knows it you know all sorts of things which you think how can you say that in public what's interesting is their Naval expansion was taking place well before that they were anticipating this so for example the type 26 frig order is a good manifestation the air defense destroyers their Navy is going to be significantly of the proportion of our Navy at the rate they're going and they needed new submarines and I remember speaking to senior officials in the government when they talked about it and they said well that's interesting because when you go and buy a short V Barracuda submarine at 4 and a half thousand tons and turn a nuclear submarine into a conventional submarine there isn't a big enough power source to do that so you're always underpowered and some of the arguments I think were we can turn them nuclear and ship the contract over somewhere along the way but they knew nuclear weapon energy at that stage wasn't acceptable to the electorate so they went large conventional large as they could with a conventional Hull hoping the French would solve the engineering problem which was doubtful from the beginning and one would argue that French was somewhat optimistic to offer it um and the delays and the cost overruns come from perhaps the desire to sell something that didn't exist so there was a vulnerability in the meantime since the pandemic the electorate in Australia demands that it be defended because it's sees China as an avert current and present threat so the barrier of having a nuclear power plant disappears so once you accept you're going to have a nuclear power plant you don't want a 4 and half th000 ton submarine you want an 8 half th000 ton submarine with a greater sensor weapon suit so all of a sudden you look at the contract the French haven't delivered you know it's not working and you can build a strategic Alliance by bringing America in because if you're going to buy British submarines you need American permission and all of a sudden you Mo base some of those submarines down in Perth and the whole construct changes and of course and Boris is great credit I think he really understood what that represented the image that you were building warships like the type 26 which would now be a stutes and essentially you would sell product you needed American American permission for it and you based your submarines you forward based them in such a way as they could threaten the choke points for the Chinese trying to get out of me the second island chain strategically brilliant and I have to give you know our Boris great credit for saying yes to it because I think many prime ministers wouldn't have done and you can understand why America's done it and Australia's done it it's a win-win but there's a sad reality and that is that our stre program is so behind and we're going to build seven and they're still not rolling off and know four maybe just about that they won't be able to build them Australia and unless we do something to create a national warship ship building program on an emergency basis those submarines won't even come in line in time for the time frame I'm talking about so what are you left with you're left with the need for an emergency ship building program for the delivery to Australia and the politicians will have to make it clear to the elector it's too complicated to build in Australia impossible when you look at the complexity of those submarines they're like building a space shuttle they are amazing amazing vessels and we need an emergency ship building program for our own Navy to expand along the lines I've discussed earlier and to support allies who wish to then buy our products we need to shift it's interesting under new labor there was something of an attempt uh by probably probably Gordon Brown really uh to Quail Scottish independence by uh creating lots of Navy jobs obviously for building uh Royal Navy expansion and so now we have this beautiful aircraft carrier which we can't actually use without the help of the US you know we've got American US Navy Marine pilots on it with us Marine Corp f35s on it and I do wonder whether or not in this uh in this scenario there may be uh maybe number 10 would think that they're sort of killing two birs with one stone where you've got Naval expansion in order to beat an external threat while at the same time quelling Scottish independence by buying off FL of Voters in Glasgow do you think that might be something that's on the card absolutely spot on I mean I wrote a piece called the battle for Scotland and what's interesting is um using my social algorithms fracture takes place when a system is in Decline and there's less to go around and so system breaks into subunits that then become more adaptable in resourcing less resources so to speak so America for example is polarizing into two polarizing entities which is very typical of decline because one thinks they have the answer and the other things have the answer but it's an adaptation Dynamic so the question over Scotland and the breakup of the Union has been asked and strategically I don't think Britain can afford to release Scotland because the British ARS become indefensible without those Northern Waters and control of you know the Iceland Pharaoh's Gap all the things that go with it that actually make us safe and Europe safe so strategically it's a very very dangerous concept and you know the SNP I think underneath it all have a very destructive agenda Way Beyond their own aspirations of personal power and the unraveling of the western system as we know it is somewhere in there uh and if you look at their Origins back in the second world war where they were Nazi supporters there are some fascinating early which are never talked about the origins of the and essentially that and I think things systems that are born with a construct continue with that value set even if it becomes covert so you know what does it look like um the difficulty you've got is that you know they are hellbent on separation despite you know impoverishing the Scottish people in the process it's just not economically viable so the argument isn't around the economy it's an emotional process yes and they think that they are replicating brexit by leaving Europe we left Europe because we were expansive and Europe was contractive and therefore we would unconsciously be more successful breaking away if Scotland breaks away from Britain it would implode and there are only two options the EU which is not going to fund them with their debt dynamic or the Chinese or the Russians because strategically it disables Europe that's the greatest threat and then you've got to ask whether the swing voters essentially that would vote for the S&P choice of U Independence are prepared to do so for a foreign flag and I think the Scots wouldn't do it for love nor money that's why she doesn't talk about it you have to ask why the Chinese Consulate is the biggest in Europe in Scotland inverted Commerce not to discuss but should be discussed so I agree with you about the idea that it would help the electric but the trouble is the S&P is sort of a dangerous entity that doesn't seek the security of the United Kingdom and so the more you put into their hands the you know and and suddenly they manag to do something which because Westminster makes a mistake makes us vulnerable so there's a balance between it but I would argue the energy is for the union to continue because when something expands it agglomerates smaller units around it and I cannot see a small unit like Scotland breaking away from Britain as it becomes relatively more successful and the vaccine story is the is really the epitomization of that energy they benefited from a larger system that was expansive and successful on that on that note I I do agree broadly with with what you say there but just for example to play Devil's Advocate as the S&P doesn't not overly at least have uh you know foreign foreign policy Ambitions uh could it not be that the S&P would would in the event of an independence vote uh and voting to leave could it not be that they would simply lease all of the Strategic assets like Faz Lane and the the air force that would be the logical process and in return We fund a country which is bankrupt yeah and that is that is the Hope in that circumstance I've just long since come in contact with destructive energies and they're always more destructive than you imagine and they don't follow logical paths actually would suit both sides and be constructive and the thing that drives SNP is probably more destructive than is publicly perceived so I would just you know I I think it's a dangerous process and West Minister needs to manage it very carefully but remember the energies are on its side so actually the risk is it mismanages it and as we go on and we go through more economic trauma and as the S&P has allowed more rope to go and show just economically how they mismanage their system whether it's a comparison in the NHS in the Scottish and English NHS obviously it's a Bor comparison whether it's the way that the lockdown protocols have been enacted there are more and more examples building of mismanagement and government and the longer that happen the more obvious it is I do Wonder uh when you're talking about how we've got sort of political political polarization now uh you know here in in England there is got two- party State now the liberal Democrats don't really have anything like the kind of influence they used to Meanwhile in Scotland it's a one party State uh I I seem to you know my my observation of it is that we're becoming a lot more American and that there's now this sort of uh we got two part we just got two parties and at the same time there's more American influence when you're looking at some of the you know the protest we've seen a lot of that you know originates from America with black lives matter movement uh at the same time uh a lot we just see a lot more American culture here in the UK I wonder in terms of you know the future of the UK and the US what that special relationship as it was described what that looks like going forward I would love to talk about but you really touched on some interesting things and that is Imagine America's Empire curve you know is basically doing this and Britain's Empire curve is doing this so look at black lives matter in America it's a point of fracture because they have always been a segregated society and it's just a matter of the degrees of segregation and as basically the base of the pyramid becomes poorer mostly black people are greatly influenced by that you create separation so it's fracture in Britain I would argue that when that energy transits across the Atlantic this is about the establish of our new cultural self it's the process of creating a proper meritocracy that is racially without discrimination and it's about mobilizing all of our society rather than parts of it which is exactly what happens in Ascension so although it looks like the same label I think the social process taking place is fundamentally different it's unitary rather than exactly right so and you look at the responses they are different this is an intractable problem over here here it's about recognizing our past and learning the lessons I do not believe we should eradicate our history our history is there and we are built upon it but we can use it to inspire better way way forwards and racial meritocracy is absolutely a fantastic concept to create how we do it is our challenge you can't just put a black person in a job because you created if they can't do the job you need to be capable as well as populating with every aspect of society so we need to balance that but I think it's a different energy over here it a fracture as fracture as fracture it's intractable until they collapse in a heap so very different I think in terms of political Dynamics again Britain is trying to re-engineer another form of politics so old western politics that we had up until this stage and America had represented wealth distribution wealth creation in some oscillation labor party was an extreme distribution policy you party and the conservatives were a wealth creation party the Republicans created wealth and the Democrats you know but America's success was in it move in its Heyday they were very incremental movements so the course was fairly consistent in Britain's case of decline it was a cease or of Destruction no money left oh put some more in whoops lost it spend it all again what I think we've seen and no one's articulated in the Press is the conservative government have rolled into accidentally and they still haven't articulated they have become a simultaneous wealth creation wealth distribution party and in that process if they can Master it they've egged the distribution at the moment and they've done things that are not so wise in the way they've done it but the concept of Distributing and creating simultaneously is a new form of Western politics and it means that the labor party are dead in their boots they don't even know they've been shot they're not even going to get out the chalks until they reinvent themselves because the next party that can challenge the conservatives or iteration of our party names has to have the ability to effectively create wealth and distribute it and then the judgment is how effectively you do the two things not whether you're Distributing or creating and I think we've seen that Revolution and that's one that Boris sits on top and will give him more longevity Than People appreciate could you explain on that a bit with the a party that can both create and redistribute wealth because of course during lockdown there's not been too much of the whole wealth you know creation event going on well that's the conservatives problem right now is the conservatives sort of have forgotten their creation policies and they need to they certainly Master Distribution on an epic scale you know almost irresponsibly in some cases but they need to hone their the creation policies and those creation policies are around low tax and and basically private sector investment not just from the people in this country but from Europe and America if you lowered it just imagine this Vision if Britain and this is not about a moral imperative not about rich people should be taxed more it's how you make everyone richer you create a flat tax and you attract all the capital from Europe and America as their systems failed and then suddenly the whole system just super explodes to the upside because you've got IP been invested in appropriately not just at universities and IDE is but through to manufacturing production should be our image we have the potential to create that but the conservatives and this move towards higher National ni tax was a disaster because it was you know part of the mandarins in the treasury thinking well you get more money by taxing more you don't lafa was absolutely right lower taxes to a certain point bring in more Capital then you can distribute it more effectively so the conservative Vision should be where the most effective creation Party by being bold and creating a series of ladders to a flat tax get rid of all the you know hmrc people that we don't need make the whole system streamlined small government and at the same time we're going to be really smart in how we distribute to our infrastructure to make us increasingly competitive that should be their image it's there for the taking well I I wish I could be as optimistic as you David about the path the government is taking but going back to the the ukus relationship could you expand on that there because I find it very interesting when you speak of uh the UK being in its ascendancy while the USA is in its Decline and that's obviously this is it was the other way reversal so so we talked about this before we sat down formally um you know the special relationship was really a consolation prize for Britain it was you know you've lost your emper chaps and we're dominant and yeah well as you know our old cousins will give you and and also because we did share common values to be fair we're not European we are more like each other than we have huge differences but we are more similar than any two Nations you know other nations in the Commonwealth but similar in that respect um the the dynamic is now very different America is in terminal decline it just can't do the things it thought it could do to shore up people don't want American values because look what America is so the exportation of of the processes of even Hollywood stories I think is actually lessening in its appeal and Britain on the other hand is just the only country in the west that's truly reasserted democracy what an incredible feat to go through the energy of a Civil War and contain it within the boundaries of Law and Constitution it is one of democracy's greatest achievements so we've been revalidated as a democracy so and America is far from it on the other part of the peace so so and we're expansive and and the speed at which we've taken that expansive stance is really fascinating to me it's been lightning quick in you know a short per of time yes it's been driven by the need to because our European friends don't want us to succeed but you know Liz truss and team have really picked up the Baton brilliantly to spread the word maybe the fine print of the the agreements could need a little bit more you know scrutiny and I suspect that that speed and rapidity have overwhelmed the details within those contracts which I think is a little concerning but you know change doesn't happen without second and third iterations and the first iteration is encouraging but we've also got to fill the gaps in that strategy you know it's a very a very bullish uh a bullish case you make for Britain um and potentially potentially potentially of course it's going to feel lumpy because we're all about to get swamped by an asset collapse so the whole of the western economy is about to hit the skids so this process is when I describe a bullish scenario this isn't a yeaw brilliant let's have a party feeling this takes place despite some pretty horrendous setbacks yes so I need to you know there are no rose-colored glasses here it's an underlying movement and change which takes place it's a bit like someone's character growing despite the fact their faces in the m and they're calling through the bar wire it's the same process they are growing individually but man it doesn't doesn't look good from the outside builds character exactly right so so one of the things that our government needs to do is build resilience and they haven't examined resilience questions sufficiently because resilience is about taking the blow and bouncing back faster than the competitors and we will bounce back faster than our competitors to blows as we did doing the pandemic but we could manage that even better now David you have been very generous with your time we shall be uh we shall tie this up soon but there is uh just a just to close with it I'd like to look at some of the the investment in implications of uh some of your predictions because they are really quite radical the you know the future uh that you see in terms of uh what you should take away and how you should position yourself as an investor you don't need to be hugely specific but just when you're looking at sectors uh countries currencies what would you favor and what would you disfavor so currencies I think Sterling is the safe haven my preferred currency in all of this the things which I'm going to describe Sterling is the place to be even if you were a foreign investor Sterling is the place to be I re iterate it you know I think you know cable might come back sort of 10 big figures worst case but then it's going to you know multiples 152 it's your safe place so that's currencies for the reasons I've just described Japan's too close to China Europe's a basket case America's a declining hgim where do you put your money Switzerland yes there got lots of mountains to surround it and there's Britain with an energy that have changed so that's the reserve currency in terms of debt so the correlation in Breaking nooda history I talked about this so Empires basically in their cycle require debt to build their competitive Advantage they borrow from themselves but they pay it back when they become the dominant hen and they become debt free somewhere around maturity in overextension Decline they start to borrow like biller as much as the world will give them and the case of America there's just no stopping them because there's no one to pass the Baton two of equal power br Britain had a very similar curve and it was saved in some ways by passing the patent to America on a relative basis so debt is just out of control and it's unsustainable and we are on for a US Western debt crisis uh especially with the forces of inflation which are building and the equity Market is a product of the Bubble at the end of the system this isn't the peak if you look at the equity markets coincidence with Empire power curves we've talked about are not the one the same thing no in fact the iron is the peak of the of the equity Market is happening right at the end of the cycle because the the the multiple leverage created by the debt that's issued to the end extreme so I think they're all on the edge I think we've seen our Peaks I think inflation is systematic and inflation will bring about the the the roll over of the equity cycle as bonds start increase and require higher yields not just about inflation but also the issue of can Sovereign pay under this environment and we will see it I think in the next quarter three the weeks and months ahead of us it's a now thing an accelerated riskof process and that riskof will lead to the last surge in the dollar before it turns over and equities us bonds and the dollar all move down together so this is really as I call it the end of the Doomsday bubble I call the Doomsday bubble because it's the end of an Empire Cycle and there's nowhere coming back for it when you and the Central Bank proves to be impotent because they've shot everything they can up until this moment and inflation becomes absolutely out of control those are the forces that the FED cannot control or any other Central Bank and we get to the bottom and then we live through stagflation at least for the next four years and Destroy whatever wealth we have so this is a wealth destructive phase with a multiplicity that makes conventional management very hard there and the only asset classes which provide in the first stages of this any kind of survivability of precious metals and I think actually precious metals are just about to wake up they've done their basing Corrections since last year and they're in the steps ready to move just to play Devil's Advocate when it comes to central banks having short ammunition um you know myself included I I never would have thought they've been able to get as far as they have and yet they have when you say that they you know they've thrown the kitchen sink at it and there there's nothing left left in the Armory do you not think there's maybe you know negative interest rates and just doing QE to the end degree might might save it okay so so you've got the FED holding up the illusion that America is fiscally solvent um in terms of its Empire model it's had a sequence of reversals Afghanistan being like the serious problem it faces a hegemonic challenger that's of equal economic power as itself greater purchasing parity already so those things when you look at the external forces of hegemonic Challenge and swap have never been greater we've never had those conditions and at the same time we've taken an already debt ridden society and we pumped even more debt into it to the nth extreme in the past year at a rate which is unprecedented and the consequences are really interesting that is every manager that most of the core managers whether they're hedge funds but they're not really the long only funds are now after 10 years of this process beta managers any Alpha generator who's Maverick who wanted to pick the high has been flipped out by the sustenance of the process yeah I in my 35 years have never seen a financial system that is so skewed to one mindset and the belief the FED will always guarantee their outcomes and when you get to that complete coherence of one way positioning you know that the only the other way is open and that's where we are now right well very very intimidating indeed when you're looking at say British assets I mean the the footsie would not be sheltered from a you know a entire Western developed Market uh you know blowout as you describe uh and you're looking at precious metals SAR you know gold and silver as you say you know they've had a they've had a rough time over the last few months but you think they're going to be really quite key going forward out of this I think they you know in terms of my client base and you know and family offices and high net worth individuals that's the strategy which maintains wealth and more importantly makes money from something where every other part of your asset base will go the one way with a coherence of one with the will the inflation that you anticipate would that s solve the debt problem or would that actually or do you expect you might see something like a debt Jubilee I think it'll be a debt Jubilee it'll there'll be awfully lot of 100-year debt yeah I'm afraid it will be a jet du now what's interesting about it in a strange way and this is like a you know a Phoenix Rising From the Ashes if you remove the Western debt button the mindset changes because you don't have to fund the debt anymore and actually you can low your taxes and stimulate your economy a different way so I think this isn't all bad none of these things are all bad because they represent change and evolution and right now we have got to make our Western economies competitive with China to just support our arms race which is going to accelerate so it may feel bad and you know I've traded Russian debt crisis Argentine debt crisis and what's interesting both very successfully pick the highs pick the lows in my career you know I've seen them all and that's why I see this is a very similar Paradigm I have a you a reasonably good track record of picking them and this has all the Hallmarks but at the bottom of it that debt Jubilee could actually Liberate the system the trouble is that stagflation is then going to stop it from and it's all it's going to have to go to a high growth low taxation model where private sector investment develops new IP that comes online faster than we've seen before that's our only way out of this one last question on on markets just in terms of uh Commodities and again with Emerging Markets when you're thinking of the rise of China does uh does that sort of Chinese imperialism make emerging markets in you know southeast Asia uninvestable or just very very dangerous well a sphere of influence is particularly relevant so for example if you look at America they are really trying to secure Southern America and eject the they' quite rightly worked out that they've got to counter China's Deb colonialism and their back door is the first place to do it so they're offering a counter move in South America they should also offer the same counter movement in America in Africa because if you remove the resource basket that China feeds upon you can strict growth so I would make those Western focuses the whole South China Sea is a battle Zone and a contested Battle Zone that really the West has lost control of the US Navy doesn't control areas inside the second island chain in that respect Taiwan South Korea Japan they're all extremely vulnerable and you almost have to Mally as a strategic plan they consider you may lose them unless you prepared to go to war at that moment and as we found out with Hitler and Czechoslovakia and the San lands when you take incremental small chunks actually bigger systems are slow to respond yes so the trick is being out of the sphere of influence that you can see immediately falling under Chinese control and if you're going to choose resources and companies with resources make sure they're in the western sphere of influence where we control them and will do you know for the years ahead well David this has been a fascinating conversation thank you so much for your time thank you for your engagement and and sharp questions it's been a pleasure great well there you have it folks that was David maren a fascinating conversation I wish You' had more time as we would have been able to discuss so many other subjects but I do hope you found that stimulating if you are interested in learning more he has plenty on his website and of course his book which is fascinating breaking the code of History he tells me there are only a few hundred more hard copies of this available before they'll have to just do the ublishing routee so if you do like the real thing do be sure to get a copy of it using the website that's displayed on the screen now that is all from me for the moment hope you enjoy the interview and we'll see you in the next one