Donald Trump And The Dollar: Either Weakening It Works Or It Doesn’t

Summary

• Dollar Debasement: The guests argue policy is targeting a weaker dollar, setting up a prolonged debasement trade with broad portfolio implications.
• Precious Metals: Gold and silver are highlighted as major beneficiaries of debasement, counterparty risk concerns, and systemic fragility, with price action accelerating.
• Commodities & EM: They expect commodities and emerging markets to outperform, drawing parallels to 2001–2007 when a falling dollar drove strong EM and commodity returns.
• Market Risks: Systemic risks from massive derivatives turnover and potential liquidity freezes are flagged, with the pace of change seen as the key danger.
• Inflation Outlook: Persistent inflation and possible 1970s-style second wave could erode purchasing power, pressuring S&P margins and favoring real assets.
• Energy & Gas: Underinvestment in oil, gas, and uranium plus EU gas policy may tighten supply; natural gas dynamics present both risk and opportunity.
• De-dollarization: BRICS initiatives and waning foreign demand for Treasuries could accelerate de-dollarization, intensifying currency and trade tensions.
• Portfolio Strategy: Emphasis on active management, real assets exposure, and readiness to rotate toward commodities and EM to protect purchasing power.

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. If somebody had looked at you and said, "Hey, I'm going to make a $10,000 bet with you that silver is going to be up 60% for the month of January in 2026." I would not have taken that bet. Hello everyone and welcome to this episode of FinanceU. I'm your host Chris Martinson and I'm back with Paul Ker of Kiker Wealth Management. Hey Paul, how you doing? >> Hi Chris, I'm doing good. Exciting times. There's no doubt about that. >> Exciting times Paul. Um this is probably going to be one of the more action-packed episodes we've had in a while. Things are really breaking. Uh look what's happened already here in we're not even out of January, right? and silver and gold and uranium and things are starting to pop and of course you know we've got the Japan stuff going on but I actually think there's a bigger thing going on and it's contained in two things first after the in the context of the WF we have a lot of really big heavy hitters in the finance industry making what I'm calling revelations they are revealing things they're saying things that if you have ears to hear super important for all people in investment and of course there's this thing called the debasement trade that we have to talk about because it's not an accident and it's not happening um just because it's happening because people in Washington in the Trump administration want it to happen and they've been very clear about that. So that's what I want to talk about today and it and it starts here with something we talked about as sort of a hypothesis a long time ago um called the Mara Lago Accords. Mara Lago being Trump's fancy suare place down there in Florida. And it was speculation at the time. I'm ready to cross that out over there because it had three big three big three big components. First, they wanted to do a wholesale economic realignment. They were going to use tariffs as as leverage. Has that happened? You betcha. Currency pegging, meaning they want to allow the dollar to weaken and that's going to be really the subject of what we have to talk about today because that has huge implications. And then they wanted to do this debt swap mechanism stuff, you know, and um which is putting treasuries into something else. by the way, as we currency peg, people probably aren't going to want to buy US treasuries, so you're going to have to find a a place to tuck them. That was stable coins. And so they've made progress on every single one of those. And then security payments, they're like, well, they want NATO and the rest of the world to pay its fair share. Well, we might just be ex exiting NATO, right? And then the global economic restructuring was replace the status quo with a US- ccentric framework. So that's just we tell you what the tariffs are and you have to eat it, world. Um, and all of this is part of what we might call a fourth turning realignment. Big, big, big stuff happening. And I think even if people have no money in the markets, they really ought to be paying attention to this because it's going to affect them anyway. >> Yes. It's going to impact every aspect of our lives. And uh, every American, anybody that's dollar based in their transactions, it's going to impact them greatly actually. and not in a great way if you're I if you're unaware of where things are probably headed. >> Well, I mean, look at the So, let's look at the dollar real quick. So, allow the dollar to weaken. That's what they're saying right here. That was part of the so-called accords. Now, still speculative. I haven't got my hands on them, Paul. I haven't read the documents. I've read of them. So, little hearsay going on. But if that was true, if they wanted the dollar to weaken, well, here's its behavior in 2025. It's down a little over 10% and it took a big old dump yesterday right here. >> And this is kind of an important moment here at the 96 level because next stop is I guess 90. And if it breaks below 90, who knows? Um, so why did we take that big dollar dump yesterday, which is this last little red candle? Well, probably because Trump said this stuff, you know, he said, I don't think the dollar has declined too much. And then he came out and said on the dollar, I can have it up or down like a yo-yo. I don't care. And he said the dollar is finding its own fair level, right? So it's been going down. And he said it's finding its own fair level. And then he finally said, you know, China and Japan have always wanted to devalue their currency. So it's kind of our term, right? We'll do it now. When the president of your country says, I'm going to make the dollar weaker. I think that helps explain why you get the dumps, you know? So >> Oh, yeah. >> So yeah. What do you I mean, >> absolutely. >> That's crazy. I I I can't I was racking my brain. Have you ever heard a president talk about wanting the dollar weaker like that? >> Can't remember one. >> I don't think I have. I mean, they've always jawbone the dollar, but I don't I've never actually I do not remember someone actually stating from the presidency or any major position of power that they wanted a weaker dollar. >> Mhm. And hey, I've got another chart that I'll share about that because this is actually really interesting because for, you know, we've talked about um support and resistance levels in the past and I like this. This is just another way of illustrating what you showed there and this is ridiculously important especially coming off of his news. You know, the the news statement that he had the other day that he was happy with what the dollar was doing. So, what I'm showing here is a daily uh chart of the dollar, the dollar index, cash settle, and we've been consolidating. We had a decline after his presidency, and we've been consolidating in here, and all of a sudden, we broke down on the daily through that level. That's ridiculously important. But there's other important charts that go. So, dailies, shortterm, think of that weeks to a month, right? So, that gives you some indication of where we are. Now, I've shown this before, and this is just kind of my linking. If we're above 115, that's a crisis dollar, you know, a sell-off in the market. Dollar strengthens as people come back to safety. But we've been consolidated on the weekly, and this goes all the way back to February of 21. So, a six-year window there. And we've we haven't officially closed on this week, but we have broken down pretty heavily. And if we close below here, we're very close to what I would consider below 95 as a debasement dollar. That's where you have to really start preparing for the weakness and that momentum is continuing to roll over. But what else is very important from my point of view, this is a monthly chart of the dollar going all the way back to 1986. This trend line has been in place really going all the way back to 2008. I don't have it drawn all the way there, but let's say solidly since 2011. If we close below this at the end of the month, that is the breaching of a 14-year trend line on a monthly basis. and we're continuing to show weakness. The only other level of support that we have is that 200 month moving average and then the g the rules of the game have changed relatively dramatically if we close below those moving forward. And everything is pointing to the fact that that he's going to get what he wants a week dollar. >> Look at that momentum bleeding off down there too. >> Oh, big time. Like it was already starting to bleed off, but now it's starting to accelerate to the downside. So, you know, those are little hints to help us reposition the portfolio and pay attention to what we should be doing uh to protect your purchasing power. >> Well, yeah, super important topic for everybody listening today. And Paul, um, we heard all these statements from Trump, right? Bes said the same thing. So, it's time for me to break out my Martinson's rule. Okay, here's my rule. If somebody says they're going to do something and then it happens, maybe they did it. >> I love that rule, Greg. That's that's a rule I live by. Okay. So So it's happening, right? And you know, we've heard a lot I think the airwaves have been fairly dominated of late talking about the debasement trade as the thing, right? But that alone can't explain the explosive rising gold over the past 3 years. I don't think it started rising hard before Trump won the presidency, right? And it's been it's been running harder ever since. So I I have to look at that through a slightly different lens. um potentially. So maybe it's the debasement trade. Plus, I think people are starting to get worried about risk, counterparty risk. Which risks are those? Well, you know, we know in in the con in the aftermath of the 2008 crisis, they rewrote the banking laws. And so that if your bank goes belly up for some reason, they don't get a bailout anymore. They get a bailin, right? Which means they want the creditors of the bank to be the ones to bear the losses. Well, when you have money in a bank, you're the creditor, right? So, so maybe it's counterparty risk. Maybe some people out there are like, I'd rather not get bailed in. How can I avoid that? Oh, I have to have my own money out of the system. You can't really take cash out of you can't take millions of cash out of the doesn't really work, but gold you can, right? >> Right. You sure can. >> It could be country level risk. Maybe we're worried maybe Japan's going to have to like, >> you know, well, they've already admitted they're going to print like crazy and debase their currency. Right. Right. And they're and their long-term bonds, their yields are showing that risk. You know, the smartest the bond traders are the smartest individuals in the room. And they're they're acting based on what Japan's telling them they're going to do. They're believing them and they're repositioning their portfolios as clear as day as some of those unbelievable charts that you've been showing of the yen in interest rates. >> And then there's a third risk that I think needs to be discussed. We will call this systemic risk, which gets us into great taking territory, but it's the idea, and we'll get to this a little bit later, and I'm going to show some really outrageous outrageous data here, but it we have this giant financial system that never goes to sleep. It has to be constantly liquid. It can't have even a single pipe frozen up in there, which you know, the pipe might be a a prime brokerage supplying liquidity to a hedge fund that's on the other side of a credit default swap trade or one of these fancy derivatives. Like everything has to be moving at all times, right? And so there's always a risk that maybe for some reason or another it freezes up, right? So I I think that's the basement trade, but also the debasement trade impinges on each one of those separate risks I just talked about potentially. Well, and I think you have the all of these forces are coming to a head together and maybe that's what it what it uh what happens during the fourth turning. A lot of it I do believe is geopolitical. You can't trust the US anymore. So if you're some of these foreign countries, especially the bricks, gold is a far better asset for you to own than treasuries, especially if it's in your possession because you don't have to worry about it being seized or locked out of the swift banking system. Of course, their bricks pay is the alternative that they're bringing up. Then I think you've got institutions that are worried about their counterparty risk and then now it's clear as day. They've been talking about the debasement trade and now Trump's laid all his cards on the table and says, "Hey, I'm happy with a weaker dollar." And what's interesting is you're seeing commodities really break out big. They're moving big time. And yeah, I think technically we've had a few new highs on the NASDAQ and the S&P, but they're not moving anything like commodities and emerging markets are, which are the beneficiaries of the debasement trade. So, you know, I've shared for a while, I don't know what to do with crypto and Bitcoin and some of those others, but my concern is that it's been a relief valve to grab the attention of the retail investor, which is the ones that are participating in it, while the big institutions are able to go buy the metals. and and um you know it's interesting to me that margin debt has increased so dramatically but yet US equities have have not moved to the level that emerging markets and commodities and those assets that benefit from the debasement trade have. >> Now on that point um I had to skip ahead a few slides. That's what I was looking down to do. But um this is actually really important I think because you mentioned Bitcoin potentially as a as a a release valve to >> bleed off some of that some of that stuff, right? Take a look at this. Um, this is gold's market cap in gold compared to Bitcoin's market cap in red. And now that we're in the debasement trade, isn't that what Bitcoin was supposed to do? What isn't this its moment in time? allegedly >> it should be shining wonderfully right now and moving in lock step with gold if it's actually the digital version of gold and and performing as they sold us sold to us that it would. You're right. That's an amazing chart actually. >> So it it's it's not it's clearly not um behaving late of late. Who knows why, right? But uh but because of that I think you know it was remember it was sold as a peer-to-p peer payment system and then they kind of said oh no it's digital gold. Well if it was digital gold these two charts would look a lot more like each other than they do these two lines on this chart. Um, so make of that what you will, but I do think that it's pretty clear, Paul, that that some that this is big giant money that's moving in to things like gold. And it's very price insensitive. And suffice it to say, none of us have seen anything like this. I mean, I've been watching gold like a hawk forever. Never seen anything like this. Now I wake up, I'm not even stunned. Wake up this morning, it's up $22 when I wake up. >> I know. It's amazing. And you know, and the concern is, are we in a blowoff top that's in the short term, or is this a regime change and we're discovering what the true price of the of the metal should be? We're not going to know until we get the benefit of hindsight. But I will tell you this, in all the years that I've been here, and I'll ask this question. If somebody had looked at you and said, "Hey, I'm going to make a $10,000 bet with you that silver is going to be up 60% for the month of January and 2026." I would not have taken that bet. I would have actually bet against it as much as I >> would have lost money on that silver at the time. I would have lost money on that bet, but this month >> silver's up over 60%. Which is incredible >> and and it's it's it's silver, but but actually the whole metals complex is kind of moving at this point in time, right? So, we could look at it as silver and I know a lot of attention has been focused on silver. I've certainly put a lot of attention there, but but we I think we have to look at it in the context of platinum, platium, gold as well. um you know and they're all doing the same kind of thing at this point in time. Maybe not to the same extent as silver, but >> once again, why is silver moving so much harder? Because Paul, it was the most manipulated, suppressed metal out of all of them. And they were all manipulated and suppressed, but for whatever reason, they really had it out for silver in in the New York paper pits forever and ever. And what was fascinating, you know, it ran up on Monday to 115 and then collapsed all the way back to 103, right? It's a $12 decline in silver. And so when I looked at the open interest at the end of the day, because normally that's accomplished, they just throw they just throw 30 40 50,000 new contracts at it. I was expecting to see 40 to 50,000 new contracts that they were just selling paper silver they didn't have for the day. Open interest was only up 2500 contracts. >> Wow. >> So how did that happen? Right. I have my ideas, but um it wasn't accomplished because somebody was just throwing because a high conviction bet is like it's gone too far. We're going to ring the cash register. And then you just start piling your shorts in open interest climbs and you just ring the cash register all the way down. Didn't happen. And of course, it bounced right back up to pretty much where it was the next couple days. The answer for that um Craig Hempky of Turd Ferguson Metals um TF Metals he said that you know the next day after they had crushed it down was the day that options closed on SLV and there were a >> that's right >> bucket of call options on SLV at 100 and up. So they had to crush it down to avoid a multi-billion dollar disaster on the other side. >> It's just how they roll. Can you imagine being one of those option holders? It closes at 103. That's the That's the option price. The next day it's back up to 115. >> That's That's something. Yeah, >> that's something. All right. >> You know, you know you're on the wrong side of the trade and your friends aren't as as powerful as the other friends and as above the law as as who's on the other side of that trade. >> Absolutely. Absolutely. All right, Paul, we're going to take a quick break. When we come back, we're going to hear from one of the absolute titans of the industry um saying what I think is pretty shocking stuff. Markets are facing heightened uncertainty and thoughtful portfolio management has never been more important. If your current strategy relies solely on passive investing or diversification without active oversight, it may be time to consider a different approach. At Peak Financial Investing, we connect you with experienced wealth managers who actively manage portfolios using disciplined, research-driven strategies designed to adapt to evolving market conditions. Our focus is on helping clients navigate volatility with clarity and confidence. While no investment strategy can guarantee results or eliminate risk, we believe that preparation and active management can make a meaningful difference over time. Visit peakfinaniallinvesting.com to schedule a complimentary consultation and explore whether our approach aligns with your goals. I'm Dr. Chris Martinson and I am proud to support Peak Financial Investing. This is not a guarantee of future performance, but a call to take your financial planning seriously. Again, that's peak financialing.com. Investing, of course, involves risk, including the potential loss of principle. Past performance is not indicative of future results. Please consult with a qualified adviser before making investment decisions. Welcome back everybody. Paul, did you catch this? Uh maybe you did. Probably you did. Ray Dalio obviously one of the wealthiest guys out there running a giant um managed money firm and he said this >> for example last year American stock market American markets significantly underperformed foreign markets and people don't quite realize that and the best asset class in a sense was gold because but think of that as being the money so in answer to your question okay I've I've learned that was a lesson I learned that if there's a depreciation in the value of money, it makes everything look like it's going up. This makes everything looks like it's going up, right? So, we've seen this, right? That you know the NIK why what what why is it going up? Why is the German market going up? Why why are all these financial assets and gold all kind of going up? Why are bonds not selling off? like everything's just sort of going up and he's saying it's because well when when you devalue the dollar it makes it look like things are going up, right? And so you have to sort of strip that optic away a little bit. But he's at the stage of the career where he can just say whatever he wants, but but he's clearly saying somebody's debasing the dollar and you got to recognize that. And that's pretty shocking really. >> Yeah. Coming from him that's a big deal. But when he first started talking about this, what about 6 n 10 months ago or so? >> You know, my first question was, okay, you're certainly Wall Street connected. You know, what's your what's your objective? What's your mission here? But it appears that he's just finally to the point that he's just telling people the truth and and trying to warn people of what's coming. He's not the only one. You know who else has been doing that? Gold. Um, I I took this screenshot just before we started recording this and so it could be a lot higher, a lot lower than that by now, but certainly by the time somebody's watching this, it'll be one of those two things. But 5269, but again to repeat our earlier point, um, Trump is elected here in November of 24, right? Um, and so it had already begun its move even before that. Actually looks like it consolidated right around the time of the election, but then woo, off we go. and it's just been picking up speed ever since. This is this is what Ry was talking about. Um he he he said something very carefully in there. He said, "Well, gold is actually money." And he's careful about that because, you know, we've been talking about gold as a tier zero asset. It stands above currency because currency is not money. This is a point of like a lot of people get this confused. $100 bill, we call it money, but it's not. It's currency. Money was always gold in the warehouse and sometimes we wrote receipts against that. that circulated that was currency. It was currency like current. It's out there doing things. But the money was actually the gold. So I think that's starting to come back in where we were fascinated and mistook currency is as money because it behaved as if it was. But now I think people are getting back to this idea of whoa whoa whoa no money is gold. Gold is money. All else is credit. As JP Morgan himself in 1916 said that. Um, I think that's the dynamic here. This is really powerful in how people invest. I actually think Paul, this is a period of time kind of make or break. Some pe if you if you get this wrong, this could be really devastating financially going forward. And if you get it right, it could be the opposite of that. Um, >> it's kind of how I see it now. >> Yeah. If we're in that debasement trade, loss of the dollar is a global reserve currency and who knows how long it takes. Let's say it takes 10 years. they're going to be the debasement, the weakness in the dollar to begin with. What has worked and that's the problem. Most people don't have a strategy to guide them. So, they look in the rearview mirror. I mean, all of the studies, if you look at 401k participants, what do they do? They look at the performance of the funds that they have in an option because they don't know what they should be purchasing and they don't have really good advice typically within those plans or access to that. So they just pick what has been the best performer and then and then those people who actually start looking for these strategies that are going to manage over multiple cycles when they're underperforming that one best performer, you know, they've been told on CNBC, you know, you should have this, you should beat the index or you should do whatever. Yeah, for periods of time you will if you're positioned correctly, but there are certain periods of time that that you're going to underperform to win the long game through multiple cycles. So that's all these individuals are looking at. What concerns me is if we're in this regime change. And I can show some charts now or later. You know, the things that have been the worst performers for the past 17 years are going to be the best performers going forward if we're getting into that regime change. And the problem is you've got big institutions that know that. You've got big money that realizes that. And then the average retail individual is going to be the last one at the table and they're going to get those past performance to look at about the time that the ball's getting ready to go somewhere else again. They might get two or three years worth of reward, but they're always going to be behind and they wonder why they're not successful over the long term because it takes more than just looking at what did the best over the past five or six years and making a decision based on that. You you've got and and you've got to have strategies that can shift you through and and help you adapt. So, I know we talked about this last week, but but now may be the time to to bring it up again. So, let me share my screen with you here. And I know I show this all the time. So, for you listeners out there that are like, "Oh my gosh, Paul's sharing this chart again." I can't tell you enough how important this is. So what I'm showing here is 2008 January 1st until today. So you've got the S&P 500 in black. You've got commodities down here in emerging markets. And for some reason that feed's not updated till today. But but you can see what's been the worst performing asset class since 2008. Commodities. Next is emerging markets and then developed markets. Think Canada, uh Australia, Europe. Right now, if we go back to that dollar chart, what's been the common theme since 2009? The dollar has been strengthening since 2009. And if this 14-year trend uh channel that we've had in place, support line, is being broken, do we really think that the S&P 500 is going to be the best asset class going forward? I don't think it is because what we're seeing is money's moving into commodities. Money's moving into emerging markets. Gold, silver, precious metals, anything that's real across the board that can't be printed is expanding. Now, to reference another period of time, let's go back and look at 2001. So, this is 2001 on that same monthly dollar chart right here. And what do we notice? The dollar went from 120 all the way down to about 70 uh or 71 on this chart. So during that period of time, what did your major asset classes do? How did they perform? Okay, so this is 2000 to 2007, S&P 500 did nothing for for that 7-year period of time. Commodities were up 213% and emerging markets were up 155. Well, why do those emerging markets tend to outperform in a weaker dollar in a strong commodity environment is because the large majority of those uh emerging market economies are commodity producers. That's that's one of the things that benefits them the most. And when you think about that, any business that struggled for a 10 or 12 year period of time, they're not wasting money because capital is hard to come by. So if you look at those emerging market economies right now, they're lean and they're mean and they've had to to operate their businesses in a manner to where capital is hard to come by. you had to really prove that you were doing what's right to get money to come in versus those companies that have had all kinds of capital flow and and especially foreign investors coming into the US which further exacerbates the outperformance of the S&P 500 versus everything else because for a foreign investor if the dollar strengthening relative to your currency and our markets are going up you get an extra um a little octane to the to the gasoline in your car. Well, that's such an important point because as we talked about in prior episodes, the S&P is now 75% of the equity market cap of the whole world, right? So, the whole world's been pouring their capital in. So, so it's like it's one of these virtuous circles turns into a vicious cycles, right? It's like it's all fun and games while the dollar's going up and your stock market's going up and all of that. And um by the way, this is what Trump just tweeted out, you know, this morning um because the S&P briefly tagged, you know, first time ever S&P just hit 7,000. America is back right now. He's crowing about that, but this is actually part and parcel of debasing the dollar. And unfortunately, it's it's a zero- sum game, and some people win, some people lose. So he's crowing about the winners in this story, but can we talk about real quick, Paul? There's losers. Who are the losers? This is a chart going back to 1990 showing import inflation, import, so you know, stuff we have to import, which is a lot of stuff these days, by the way. Um, you look at our trade deficit, pretty big. And the US dollar change, and this is year-over-year percent, it like these are just locked. If the dollar goes down, you know, import prices go up, right? And vice versa, right? So, um, as we see here, what's happening now is the dollar is actually going down. What do you think? What do you think's going to happen to import prices? >> Oh, they're going to go up. >> They're going to go up. >> They're going to have to go up, right? >> The only thing that's going to keep them from going up in the short run would be a major recession. But but if the dollar continues to go down and even if we have a major recession, that supply and demand uh dynamic may hit it in the short run, but as soon as it as soon as the economy picks back up again with a weaker dollar, they're going to explode to the top side. >> Yeah. So, all right. So, this this is great setup. Let's get to it. So, there's a couple there's some risks. So, let's let's imagine their success with Mara Lago. They put out the tariffs. They um restructured the global economy. you know, we exfill from NATO a little bit, but we get the weaker dollar that they seem to want. If that happens, what do we face? Well, first, the budget deficits and the trade deficits can both grow even larger than they currently are, right? >> Because a weaker dollar is not going to help our budget deficit all that much for a couple reasons. It could be we see foreign capital flight out of this, Paul, like you know, the S&P we just mentioned, 75% of entire global market cap, but could be worse than that. We're going to see certain corporate earnings under pressure like Walmart, anybody who's importing anything, right? It just squeezes, compresses your profit margins. And then finally, the reason this ties back to the budget deficits, too, is the idea that there could be even more rapid flight from US treasuries, the world has not been so happy picking up our treasuries of late. >> No. >> Right. China's selling them. Russia doesn't want anything to do with it. Europe's kind of like begging off. Thank God for the Cayman Islands. whoever it is down there, >> you know. >> Yeah. >> Um, no, but these are all things that could happen here, and I think these all have to be considered from a a domestic investing portfolio standpoint. These are real risks that could happen here. >> They're very real risks, and you've done a great job laying that out. There's one other thing that I will add. A weaker dollar, especially if it's consistent, is going to is going to be tough on small businesses and the middle class. If you're a major corporation, you have the ability to hedge against those currencies. And if you're doing global business that may that may be good for your business from a standpoint, but the average small business around the country doesn't have the ability to hedge against those currency trade the currency declines and that's going to put further pressure on the small businesses within the country and the middle class and it's going to even more empower the larger corporations. So it's not good all around. Completely agree. And there are some other risks we we should cover here and these I would call these are bigger. These are more systemic risks that might happen. Um the first is ddollarization happens even faster which has already been undergoing bricks and everybody. Um maybe loss of reserve currency status. That's a big thing but could happen. Um but you certainly are going to get currency wars, trade retaliations, protectionism, competitive devaluations, reciprocal tariffs. These are just sort of the things that that countries are going to have to do because if it turns out the United States is like really weakened its currency. What does Japan do, right? Because they sell us a lot of stuff. Like all of a sudden Toyotaas the dollar goes down 10% Toyotas get more expensive to the extent we import them. Um I know they make some domestically. But the point is is that eventually Japan's going to have to say, I I think I have to be part of that, too, or I'm going to have to protect my domestic market from um really cheap, you know, US corn or whatever the story is, right? So, you'll get more of that stuff. I think we have to talk about global economic contraction while this all gets sort of sorted out that I don't see how this is going to be conducive to robust trade. Um, and then finally, what happens if derivatives can't manage the pace of the change here? That's a nightmare. >> Mhm. >> That and then Warren Buffett's quote that derivatives are weapons of mass financial destruction becomes prophetic in uh in the end. >> All right, this leads to another Martinsonism. Paul, you ready? Yes, >> it's not the final result really, but it's the pace of change that matters. The pace, you know. >> Oh, that's so that's so clear in your thinking. That's another good zinger. You're right. The pace of change is what matters. If it happens slowly, adaptation can take place. >> If it happens quickly, the system breaks. >> Yeah. Um kind of kind of macabra, but you know, if I walk down from the top of the Empire State Building, no big deal. if I fall off the top without a parachute. Kind of a big deal, right? Um because of the pace of the change at the bottom. So, this is a big hairy area and and nobody knows anything about this and and I've asked a lot of people, but and I just mentioned the magic derivatives word, but I just want to mention this, Paul, because I think this is part of the systemic risk that's that's worth considering. So BIS in December of 25 put out their yearly summary of what's going on and they said the notional value of outstanding OTC over-the-counter derivatives rose to 846 trillion in June of 2025 up 16% from the prior year. Okay marks >> gracious >> an acceleration from the moderate 5% annual upward trend. Okay 846 trillion this is notional value. So you and I Paul we might write a derivative as a contract. So, we write a contract. I say, "Paul, I think treasuries I I want to be protected if treasur 10-year treasuries go to 5% next year. It would be an interest rate swap." And you'd be like, "Great. I I'll I'll take the other side of that." And so, we write the contract. And then, um, that could be for a billion dollars. That's the notional value, but what's really at risk might just be few tens of millions under there if it goes against either one of us, right? And that's the actual gross market values when you sum them up. Well, turns out the gross market value of these OTC derivatives rose by 5 trillion. 5 trillion 29% year-onear to 21.8 trillion. That means somebody owes somebody else 21.8 trillion in this story. >> Goodness gracious. >> That's incredible. >> It's a big number. That's a big chunk of the entire US economy. Um isn't that amazing? And then and then here's the part I wanted to get to. Um the Bank of England reported this out at the end of the year. Um this is just this is just interest rate derivative turnover. Just interest rates just one class of derivatives. We could have derivatives around selling gold to each other. We could have credit default swaps would be another one. These are just interest rate derivatives. Okay, it's credit um usually an interest rate swap. Just in that one class, the net average daily turnover in the UK alone was closing in on $4.5 trillion per day. This is a daily turnover, right? The US was cranking out about two trillion and then you had all the rest of them up. So it's basically um four and a half, five and a half, six and a half, seven or eight trillion dollars just in interest rate derivatives in the Western world every day back and forth, right? And so the point I want to make about this, Paul, this is the plumbing when we talked about what could activate the great taking or whatever. This is what this when you know Jerome Powell comes out and says, "Oh, I care about price stability and how many people are working." Nope. He cares about making sure this thing does not accidentally get plugged. So, this has to We need trillions of daily flows and that's the whole financial system. Okay. All right. Well, interest rates and all these derivatives are basically insurance policies and insurance policies are great as long as you stay within the bands of acceptable, right? If two houses burn down in in a city, it happens. If the entire town of Paradise, California, burns down, insurance doesn't work anymore, right? >> That's right. >> So, this is kind of when when I say there's this there's this there's these this is what I'm concerned about with the Mara Lago stuff. They're doing some big some big crazy stuff. And I don't know what the pace of change is going to be in this, but gold is telling us something. It's this is if anything, Paul, it's the pace of gold's price change that is most alarming in this story. >> And it's not just limited to one asset class, you know, and and Chris, I got to say this, when you're sharing that information, I I did not realize that's how much was taking place on a daily basis. All I can think of is one of the most popular products on Wall Street for scared investors right now are these structured products. And these structured products have derivatives overlays on them and they protect you against certain downside risk and all this and they make people feel real warm and fuzzy without the realization that you have the counterparty risk on the other side that if those derivatives contract fails, there is no protection to the downside because it's all papered over in a financial financialized product. So, you know, for the listeners out there, be very careful of those structured products because we're in the type of environment that these rate of change can cause something to go wrong. And just remember, they're based upon what Warren Buffett so eloquently stated back in 2010 to 2012, somewhere around there, of products that are weapons of mass financial destruction. I mean, a nuclear bomb is harmless as long as you don't pull the trigger. But if that that that trigger is um accidentally pulled somehow or deteriorated to the point that it goes off, it's mass destruction. So, you know, I just can't help but think about that and and just how financialized the economy has become and the financial markets have and how sexy these options are for retail. Retail's at the highest level of options participation ever. And that's just more money flow through a system that's becoming more ever more fragile. But going back to the rate of change, interest rates in and in in Japanese yen blew out to all-time records, right? You've got gold that's been moving at a rapid pace. And then 60% on silver in one month. That's a ridiculous rate of change. And then you're starting to see breakouts into other areas. So, you know, you've got three key components uh to of an indication for the global economy, especially the carry trade. The rate of change of interest rates in Japan and what's taking place there is going to have ripple effects through the carry trade. The question is, is that money going to gold? Is that money going to silver? Is it going into commodities? Where is that money going? But, but you know, over the past year, you said creaking and popping. I mean, we we've got some many explosions taking place in different asset classes right now. >> Well, and yeah, >> one last thing. The dollar is breaking major support right now. What happens if that rate of change, you know, let's what happens if the dollar is down 15 20% 90 days from now? I'm not saying that's going to happen. But what happens if that occurs? That's more breaking within the system, more stress on these derivatives, more stress on these counterparty trades between each other that have papered over products that do not have a historical back test to anticipate any of those type of moves. They just don't think it's going to happen. Mhm. Well, and there's there's um one other piece to this that that's really important to me about all this, which is that um Allan Greenspan used to mumble about this and how derivatives were these wonderful things and they really help people manage risk. And I took exception to that, Paul, because if you think you're insured, right, you end up taking more risk, not less. So because these derivatives have more or less worked and every time things got a little bit tight in the markets, there was the Fed throwing money in and all the central banks, you know, because they were just keeping that system liquefied and that's what they cared about. Fine. So they did that, but the more they did that, we should have done that and made the derivatives go away, but we made them twice as big from the great financial crisis. So So it in it made more risk takingaking happen. And by the way, it hasn't shown up on the landscape at all. It's nowhere to be seen. There is no risk. It's it's it's totally managed until it's not. And then when you get that rapid sudden change, you suddenly discover, oh, we didn't shoot the risk into outer space, never to be seen again. We just hit it under the rug for a while. And now we have more of it than ever. And it suddenly all has to get processed all at once. And that's that's the concern here. And it's like a home that has termites that get in it. But instead of going in and tearing the wall down and replacing and killing all the termites, you just keep putting sheetrock over. You keep putting something over the top of it to cover that patch and you've not solved the the underlying problem. >> You've just papered it over. >> So, it's not going away. It's going to come roaring back with a vengeance that risk is. And my concern is it's going to be >> slightly slowly and then all at once because we're seeing so many things start to move slowly and then all at once. And it's been good for the assets that you know we've been talking about silver gold. Not been good if you were in the yin carry trade. It's not going to be good if you're going to be hurt from a weaker dollar because this is a slowly now but we're starting to break some major levels. The question is how quickly will this rate of uh rate of change occur and how quickly will the dollar decline? >> Indeed. And uh Paul we're going to take a quick break. When we come back, we're going to uh hear about what the average I'm an average investor. What what an average investor really needs to consider and maybe start doing about this uh just as soon as we come 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 investment advisory firm connects clients with experienced wealth managers who focus on active portfolio management. These professionals use evidence-based strategies designed to respond to changing conditions, not outdated formulas, but customized approaches grounded in research, discipline, and risk awareness. We believe in open, informed conversations, including discussing tools like precious metals and diversification as part of a broader financial strategy. Every investor's situation is unique, and our advisers tailor their guidance accordingly. Visit peakfinancialinvesting.com today to schedule your free consultation and explore how proactive management can support your financial goals. I'm Dr. Dr. Chris Martinson, proud to work with Peak Financial Investing and my support reflects my professional views. I encourage you to take control of your financial future by making informed decisions. All right. So, um, Paul, I I I said there were all these revelations happening. I want to go to another one. So, this guy, Ron Baron, big billionaire kind of guy, um, investor and everything. So, this was this this is right up your alley. Listen to this. to happen is the value of your money falls in falls four or five% a year. That's inflation falls four or 5% a year and the economic growth has been about 2% a year. So it's about 7% a year growth and that means everything doubles in 10 years. The value of your money falls in half every 15 years. So you got to make twice what you're making today in 15 years to stay even. And so stock market, you know, so Bitcoin's been amazing obviously. Uh >> so he's talking about that magic compounding function you and I talk about if if the if the money supply is basically doubling you know which it is um every uh 10 years that means you have to you have to double your income essentially every 15 years whether you're a retiree and you're saying oh well you know I I need to live on whatever the number is for you let's say 3,000 a month now or 5,000 whatever the number is but you plan to be there in 10 years over 15 years, you're going to need twice that coming off your portfolio. >> Just at at these numbers he's talking about. And of course, inflation might not be done with this yet. And we'll get to that in just a second. But, um, how do you I mean, this is right up your alley. Do you have You must have these conversations with people every day. >> Oh, I do every day. So, one of the most important things that I do when I take people through the planning process, you know, we're going to stay at the 3 and a half% compounded. That's that's kind of the the staple for the industry. then we're going to run them at 5 a.5% compounded on inflation. And I spend a lot of time talking about just how devastating inflation is. Most people think that 1929 is going to be their greatest risk when they get into retirement. Now, that's your greatest single type risk of a 2008 or a 1929 or or even a 2000 to 2003. If you don't have some downside risk management in there, that can absolutely derail your retirement. But think about it. We're talking about three major windows of time historically. What's the persistent and and absolute risk that you're going to have when you get into retirement is inflation. That's exactly what it's going to be. I haven't talked about this for a long time, but this is my 28th year of working with retirees and specializing. And I remember back in the year 2000, there was people that I met, hey, I've got a million dollars in the bank. I'm getting 7% on the CDs. Why would I want to carry any more risk? Well, they didn't think that there was any risk to the interest rate that they were earning because, you know, that they remembered 17% rates in the 1980s and now we're down to seven. They can't go any lower. Well, they felt like geniuses from 2000 to 2003 when the market dropped, right? Hey, I'm in CDs and I'm doing good, but interest rates went from 7 to five. And then we get into 2008 and they feel like geniuses again. you know, conversations I would have, I had people come up like, "Man, I I I feel sorry for you being in the career that you're in." And I'm like, "No, you don't understand. We run a riskmanage strategy. This is a great environment for us and our clients." Unfortunately, but fortunately, because because of sidest stepping that decline, but then 2012, government drives interest rates down to zero. So, these people are all on one side right now. They're starting to hurt, but they're scared to death of the market because what they've seen. So if you don't plan for inflation, my point is you you might can I mean being all safe right now with the way the government's printing money doesn't make sense. Back then it made a little bit more sense. But the problem is if interest rates go to zero, we know what the government's going to do and inflation is running ahead and you don't have any potential growth in that portfolio so that you can have some rising income over the long term, you're in trouble. There's only two ways that you can deal with inflation when you get into retirement. Prepare for it. recognize the risks of major market downturns and what that can do to you, but put in some strategies that can, you know, control that risk or reduce risk in the portfolio. You're not going to be able to pick the top of the market. You're not going to be able to pick the bottom. It's not a market timing issue. It's a recognition of the risk. And if the risk to the downside becomes more than the upside, then protect your capital. But, you know, you've got to prepare for that because if you don't have your portfolio positioned to where you can earn more than what you're drawing in retirement, then you're going to you're going to absorb that that either in a reduction of your standard of living, which is ridiculously painful for people because they spent their entire life sacrificing to get their money there. But but for lack of knowledge and lack of education in our industry uh uh because the government doesn't want to really let you know exactly what inflation is and how damaging it is. They pay a heavy price down the road because it eats away at their purchasing power year after year and it's 10 or 12 years into it that now all of a sudden they're having to make major lifestyle changes. They can't play golf as much as they used to. They have the health and the and the ability to go, but they can't travel as much as they used to. They can't give the gifts that to the kids that they used to. So, their entire picture of retirement, you know, they're so scared to have some volatility in the portfolio because all they can think of is a 1929 without realizing that slowly and all at once they realize they've fallen behind. So, you have to plan. That's why I focus on that retirement planning and spend so much time talking to people. That's the reason why I don't give people a questionnaire that tells me how they feel. I mean, that's what our industry does, Chris. It makes me so angry because you go to an adviser and they're like, "Hey, here's a form." If they don't give you a form, they ask you questions to determine your risk tolerance. Well, I've tested this on clients in the past. When the market's really good, their risk tolerance is higher. When the market's really bad, their risk tolerance is lower. But you shouldn't be investing based on how you feel and your emotions because you've got to keep those emotions in check. You should develop a plan based on what you have to do to maintain your standard of living. So it's just a you know what I take people through is it's a give and take. Okay? So if I run into somebody and it says look you've only got a 60% probability of not using up all your money at 5 a.5% compounded inflation in retirement. So what would you rather do? Would you rather work another five years longer? Would you rather live on less? Or would you rather carry a little bit more risk in that portfolio? Now, there are limits on how much risk you should be carrying, right? But it's all personal. And the point is taking people through that retirement plan analysis helps them understand why they need to be invested way. invested understand why they need to have a riskmanagement overlay so they're aware of the risks assoc risks to their being successful in retirement because here's the thing like I tell clients look you know don't go borrow money to pay for your kids' college uh make sure your retirement's in place first because your kids can work they can borrow money there's all kinds of things that they can do and that may not be what you want for them but they have all kinds of avenues to get that education or that that uh um skill that they need. There are no doovers in retirement. And and my concern is is people are so complacent in general. Now, most of your listeners are not, but I'm sure there's some listeners out there right now that have been complacent. They're new to this. They're trying to figure it all out. You can't be complacent because you there no doovers in retirement if you don't plan correctly enough. That's why we spend so much time and effort helping educate people there. And nobody's if you run out of money and you've already, you know, you've loaned your house or you've done a reverse mortgage or something like that, nobody's going to loan you money like they will to get a college education for the last 10 years of your life. The only thing that you end up doing if you haven't prepared correctly enough and implemented a strategy that can help you navigate an unknown future is give up your entire um picture of retirement and live your final years in misery essentially relying upon the generosity of other people and hopefully you've got people that have the wherewithal to help you if you've not planned correctly enough. That's why we spend me and all the adviserss recognize how important that planning is and and now it's easy. I had a hard time there for a while because my requirement somebody comes in they hey I want to work together but I don't want to go through that process. Okay, we're not working together. I mean, it's just that simple now because you need to be aware. And every person that's fought me the most of going through that has been speechless. Usually when I get through with the 5 and a half% inflation analysis, they're like, I had no clue. And I'm like, that's why I'm required that you go through this. Now that you're you have some knowledge, here's how we're going to change your situation. Here's the options you have to to increase your probability of success and prepare for that inflation. I hope we don't get it. I don't see how we don't at this point and I hope we don't get it. But I would much rather prepare for for that great likelihood and it not unfold than I would to just hey let's not let's not waste our time going through that because it's the most important thing before you get into retirement. And most people don't understand. They just don't understand. >> Well, and and let's um and thank you for that. Um, and I hope you're flexible about this because we may have to like revisit this whole conversation. You may have to do it with everybody and and ask a question above 5 1.5% because um, what have what have we found out in the past few months? We found out that certain states are basically running fraud and racketeering operations, right? And it's very expensive to do those. So last year nationally, property taxes went up 7% on average nationally. Some places were much worse than that, some were less than that, but you average it all out. Why did we have to go up 7%. Well, partly inflation, but partly maybe it was frauds and scams. I don't know. Local governments needed more money, right? So, and what can you do about that? Typically, not a lot unless you're willing to lose your house, right? So, >> so that's uncontrollable in insurance costs totally out of my hands. There's not much I can do except maybe take less coverage or worse coverage or something like that. But if I want to drive a car, have a mortgage, and not, you know, fly naked in the in the medical system, I need insurance across all three product categories. Those went up way more than 5 a.5% on average, right, for everybody. >> They sure did, >> right? So these are entirely unc those are two examples of uncontrollable things. But um you and I have talked about this before, Paul, but this is from Torsten Slack of Apollo um asset management, and he asked the question, well, what if what if we see a repeat of the 70s. So two lines on here. Um green is current, but blue was the '7s, and we had this first mountain of inflation at 75, and then it came down. Everybody's like, "Oo, got that under control." Remember, um you know, then we had the second mountain. This is where Paul Vulkar had to remember 14% interest rates on 10-year bonds, 21% on 3-month paper. Like, that's what it took to kill this. Can you imagine those interest rates in our current mountain of debt? I mean, it just be like it'd be impossible. >> It would destroy the system. >> Game over. >> Game over. >> I mean, what was our debt to percent of GDP back then? Can you remember in 1977? I mean, it was minimal. I think it was I'm going to take a wild guess. Don't hold me to this. 25 to 35% if I remember correctly. And now we're what? I don't even know the most recent number, but it's over 100%. >> 120. >> So that's a >> 120. 120. That would be absolutely game over. Every state's going to have to cut back or file bankruptcy. They're going to have to rig the fraud out of the system then, right? Because the whole system's going to explode. And I don't see how with the policies that that this administration and prior administrations have put in place. I mean, nobody has changed the fiscal foolishness, they just they just spend more. I I I don't see what's going to change it. And the belief, you know, that hindsight bias in our leaders that, hey, we printed all this money in the past and we didn't see inflation. Well, we had a lot of deflation to ring out of the system after the 2008 crisis. I think that's solved at this point. So, we're at a point where extra stimulus, extra money, weaker dollar, um, is going to fuel that. And I'm concerned that it may be a steeper rise on the other side than what we saw in the 1977s. That was just a a birth pain and a type and shadow that we can use with the benefit of history to educate ourselves for what more than likely is coming over the next 7 to 10 years. >> Yeah. And it's history's going to rhyme again probably, right? So we look at here from 74 to 82 RHS means right-hand scale peaked out at 14% inflation here. Um but if we look at this notice uh it started here at about 5%ish or something in 1977 but then it was 1 2 3 four full years of having to live through that. That's really that it's extraordinary what kind of budgetary damage that can do to a um a retiree or something like that. So why would it rhyme? Well, that was a combination back in the 70s. A lot of money printing, you know, we had we're just sort of printing money for that thing called the the Vietnam War right here in 71. We we we got off the gold standard and oops, you know, um that provided no restraint on money printing for a while. Uh on and on, but also there was an oil shock in there. And so if we look now, Paul, there's been just the most massive underinvestment for years because it's been exciting to, you know, we've been chasing the financialized products, right? Financialization is a process of using money to make money. Usually that's it. That's all you do. The carry trade does nothing. Not a single widget gets produced. No extra acre of corn gets planted. No mines are opened. You just carry money from one spot to the next, right? Whatever. So, we go through all of that and and I don't see how we avoid what we're going to call inflation, but it's actually going to be a failure to have invested it properly in things like copper, uranium, oil, you name it, right? We just we just didn't do that. And so, now if all of a sudden we wake up one day and we're like, "Wow, we need a lot more of all three of those things." It's going to be about this many years of investing to just to just begin to crack that nut. That's why these things take so much time to sort of play out like that. And I I I'm worried most people aren't aware of just how likely that that outcome actually is at this point. >> And one thing that I'm really worried about is if that unfolds, individuals have been convinced that, hey, I'm better off to own the S&P 500 than I am anything else. And that may not necessarily be the case. So since you've shown that, I want to follow up and show a chart. It's a longer term chart. I need to peel this down closer to 197374, but I want to I want to point this out. So, so far all of the government actions, and this is a chart of the S&P 500 monthly going all the way back to 1926, okay, January 1st. So, the black line is the S&P 500. I've talked about this, I think, before. The dotted line here, the red dotted line mirroring close to the S&P 500 is an overvalued market. traditionally textbook overvalued price earnings ratio of 20 or more. So you can see where we are right now just to get back to what's traditionally considered an overvalued markets. What about a 30% decline? Blue is a fair value and green is undervalued. So what I want to point out right here coming in 1973 it was the nifty50. You know there's always a theme that gets everybody excited. So right now it's you know your magnificent 7, your AI themes all of that. Well, in 197374 is when that inflation accelerated. Well, how many people, Chris, do you believe that the equity markets can go down if we had an acceleration of inflation? >> Very few, I would assume. But what actually happened in 1973? The S&P went down 47%. >> 47%. Now, notice that's based on the priced earnings value of the company. So, earnings went up. But why did the S&P go down 47% approximately in 197374 is because corporate profits were hammered because of that inflation that comes in there. So my concern is now back during that time commodities did good, international investments did good, utilities, a lot of those things that that benefit from inflation did good, but the general S&P had a pretty major decline. Will that repeat this time? I don't know. Maybe they paper it over to the point that the S&P does good, but it doesn't go up as fast as commodities, emerging markets, and those real assets that are out there. It It's a regime change, and it's really important to position yourself before that really gets underway. You can always do it sort of midstream, but um getting to that party late is is an expensive proposition, you know? >> Correct. And by the way, um, you know, Trump basically saying, "Hey, look, we're going to do the Mara Lago thing. We're going to weaken the dollar." When you do that, by definition, you're basically saying everybody who's already an asset holder is going to be rewarded. And everybody who's not an asset holder and just sort of living off of their paycheck is going to pay for that, right? Because again, it's a zero- sum game. There's no such thing as like, oh, we weaken the dollar, everybody like wins. No, there's winners and losers and they bow offset. So, they've made it pretty clear that they want asset holders to be the winners in this story. I think, Paul, editorially, that helps explain why there's so many angry people. And I think they're angry potentially about the wrong things. I I their anger is justified, but I think they're getting angry about the wrong things because the reason their lives are not progressing, the reason they're finding it harder to get by, the reason why they're losing hope in the future is not because of that other guy on the street or gal. It's because of these policies that have been run that have been disadvantaging them this whole time. And that that does feel that doesn't feel good. I admit. >> Right. Right. I mean, and and the pressure that people are feeling in a good economy, uh uh people have reason for hope, but the depression levels, the suicide levels, the drug addiction rates, the overdose levels, that's just evidence. That's the fruit of these behaviors that our our politicians have put us through. And the thing that breaks my heart the most is we seem to be divided. There's there's people that are on the far left, right? And and oh, they they hate you because you supposedly voted for Trump. The people on the right, same thing. Oh, I hate you because they, you know, supposedly voted for Biden. Then there's there's those of us in the middle of their equal opportunity bashers of both sides, right? We just want what's rest and look what's best for society and look for wisdom. But they've divided everybody and each side doesn't realize Biden spent way too much money. Trump's spending way too much money. It's the same thing. They're both talking out of one side of their mouth to one side of the country and talking out of the other side of their mouth to the other side of the country, but they're all headed in the same direction. And that's what's so heartbreaking at this point. I had somebody get on to me because I was being so harsh on Trump lately. And and it's not, you know, I I'm frustrated because we haven't changed the trajectory that we're on. And unfortunately, when you study history enough, now I hope that I have wisdom. I ask the Lord for it every single day. But there's a saying that with much wisdom comes much sorrow. Because if you really understand history about what's taking place, you can see where this is going. You you have done such a good job of, you know, crash course. I mean, you saw where this was going. Those of us that can see where this is going are trying to do anything that we can to to influence the politicians. And I've come to the point my only job is to to help the people that we are have the opportunity to serve before the Lord as best we can navigate the days ahead to try to protect them with the resources that they have to manage. And are we going to navigate it perfectly? Absolutely not. because we're in completely uncharted territories. But you don't have to get perfect going forward if you're adaptable enough. If the information changes, you change your mind and you'll end up in the right in the right place in the end, even though you're going to make minor missteps in the interim period. The Bible tells us that those that are striving for right will stumble, but they won't fall. And it tells us the other side of that is catastrophic wipeout. You'll fall and you'll never get back up again. >> Indeed. And let me tell you why I'm I'm concerned. Um, you know me, I always have concerns, but I'm concerned because Paul, there's this idea that, you know, you and I could talk about the stuff in the crash course. We could talk about Fed policy. We could talk about all these imbalances. And that's what's called private knowledge. We could even share it with everybody listening right now. It's still private knowledge in the sense that we all know it. And that hasn't crossed into this thing called common knowledge, which is when everybody knows that everybody knows the same thing. The information hasn't changed. It's just now we know that everybody knows this thing, right? And so I open this up by saying this is about revelations, right? So we had Ray Dalio saying, gosh, you know, here's here's an important piece of insight about the dollar. Then we had Ron Baron going, gosh, you know, you're going to have to, you know, consider that inflation is much worse than advertised once you compound it out a few years. And then we have this guy, the former World Bank president, saying this. Yeah, it's a worrisome. You know, the Fed basically has become now just a giant hedge fund. It's lost a trillion dollars, you know, and counting. It's going to be a a gigantic loss. What it does is borrows money at 5.4% from banks and then dumps it into government bonds. So, think what that trade does. That causes the government to think that it's better off than it is. And so, that encouraged and uh the government to be short when rates were zero. So why did the government leave, you know, borrow so much in Ta bills? Uh well, cuz the Fed was buying the bonds and it made it look like yields were going to stay low for remember the low for long phrase. Uh so we've got these multiple problems that are going on and it it endangers the dollar. So that's the basic case. >> So I think we're getting we're getting we're getting Paul, we're sneaking towards that common knowledge where it's it's okay now everybody knows that everybody knows that the Fed is way over the tips of its skis. It's nursing a trillion in losses, right? So, it has maybe less maneuvering room. And um in talking with Adam Rosenwag, great interview. Anybody who hasn't seen that, really good. But he basically said, "Look, central banks will continue to do what they're doing until they can't." And why? What would force them to not? >> Well, if they start printing this money and your sovereign debt yield starts spiking, they can't do that anymore. That's where Japan is right now. or inflation has taken off and they really can't do it for political reasons or worse maybe inflation can really get away from you and really ruin stuff. So that would be the only can't like and I feel like we're getting closer to that can't moment and I know that because we have all these big I didn't I brought like um Ken Griffin of Citadel. There were all these people at Davos saying the same thing. So now it's okay for the billionaire class and the World Bank president class to start saying, you know, this is a really dangerous strategy that could that could blow up, you know, and here we are. And all I could think of when he talked about the Fed basically becoming a big a big hedge fund. So what do we have in the halls of power now? What was it that Bent did in his career? >> So you got a Treasury Secretary that was a hedge fund manager, >> experts at financialization and milking the system. M so do we have any doubt that they're not going to do everything that they can to milk and manipulate the system going forward? And and here's my question. You know, there are people that say, "Hey, they've got it all under control. We're fine." Okay? I don't hear that that often, but I hear it every now and then. Well, if they have it all under control, how come uh yields are blowing out in the end? How come gold and silver prices are blowing out? That's evidence that we're seeing that they're losing control in certain areas. And if you're spinning 12 plates, you know, and you lose one, you got to make a decision. Focus on the rest. But if you hesitate and lose a second, then they all come crashing down. And that's my concern. How quickly all this comes apart, I don't know. But it's it's obviously starting to pick up steam. >> Yeah, it's going faster and faster. So, we're kind of down to that Lenin quote here where, you know, weeks uh where decades are happening. Uh, and that's certainly been the start of 2026. It's what a action-packed, but I don't I don't think it's going to slow down. I I think we're going to see lots more of um what they call volatility in financial circles. Um, but uh that's code speak for um markets falling and things like that, I guess. I don't know. But but for sure, they've made it clear, Paul, they're going to protect the financial assets as much as possible. They don't really care. Worse, it's not even they they're indifferent as to the pain that's going to cause to average people. They're not on the radar screen at this point in time. I think I can't detect that really average people have a voice in Washington DC or in Brussels or in Ottawa. I mean, I just can't tell that that it feels like it feels like the average person's kind of on on their own in this in this story and they're going to have to get by as best they can. >> We have clear evidence of that recently. One thing that the left and right have come to the agreement on at least in the past that they wanted the truth of the Epstein files to be released, >> but they still haven't been. I mean, I you know, the left wanted it, the right wanted it. Nothing's happened. So, that's just evidence there that the common individual just doesn't have a voice at this point. >> We're being ignored. >> It was very popular, too. Both sides are like, "Yeah, let's let's audit Fort Knox." How hard could that be? >> That's right. >> You know, where's where's my audit? Um, what do you I I mean, I have so many speculations, but I I think the reason it hasn't been audited is because the audit results would not be favorable. Um, that's why things don't get done in Washington. >> Well, I'll tell you one thing that's interesting is, you know, we're supposed to have the audit, it doesn't get done, and then all of a sudden you start hearing this narrative, well, they don't want to audit it because we've got a lot more gold than what we state that we are, and we don't want people to know that yet. Yeah. And I'm thinking, okay, really, you're you're trying to counterbalance this and cause some confusion out there. Just audit it and get it over with and let us know. You know, if you want to really know the reality, bring it into the light. Pull it out of the shadows and bring it into the light. We should have bright lights on everything from election counting to the finances of our politicians to who's donating to their campaigns. Full disclosure of who the lobbyists are, how much they're getting paid, how much money they're donating. We should have full disclosure. That's the only way that we're going to bring integrity and honesty back into the system because we have weak men in the halls of power. Weak men and women who are giving into their base desires because we've been through easy times. And easy times create weak men. And the hard times that are coming are going to create, you know, good, strong men and women that will change it for the next generation. But unfortunately, they're going to get an inheritance that that they just don't deserve. >> Well, for for people who uh do have assets or have wealth to be managed or anything like that, um I do think Paul that this next period of time is going to be one of the more outrageously um interesting and I think they think there's a lot of fortunes to be made and lost. But I do I do think that if you can see where the puck is going to go, these underinvestments I just talked about, we may have to be patient, but they always play out there. There's just there's no such thing as a material shortage of copper. Like you can't like all you can have is is a price that has to go a lot higher to make sure that supply and demand balance out, right? It's just econ. But um we can't like we are just we really failed to plan for the future, right? >> Mhm. in in this country at least. I think Europe's on that too. They just signed, did you see? Europe just signed very proudly, two ladies and some people standing behind him signed a thing that said they're going to make it illegal across the EU starting next year to buy any natural gas from Russia. Okay. Now, interesting. At this exact moment in Bavaria, their gas reserves are down to 6%. They're effectively over. So they triage and they have to they put it to residential because they don't want people freezing to death in their homes which means that industry just has to shut down. Um another like blow to German, you know, industry at this point and it it could be fatal for some companies cuz some companies very hard to restart once you go through a shutdown. Um and maybe it's not going to be worth the effort, blah blah. But I just want to Paul, I just want to shake those European leaders and say where are you going to get your gas from? Like oh we got these contracts with the US. then you should be looking at the fact that um over the past year for whatever reason US natural gas production has only gone up by 1 billion cubic feet per day but demand has gone up and is going to go up by another 12 to 14 within 2 years and we're not getting more out of the ground worse we're getting less out of the ground across every shale basin except for the perian that's the only way we got a little extra out so you know what's going to happen Paul we're going to wake up one day the S is not going to have as much gas as we want you know what we're gonna I don't I'm not proud of this. We're just going to tear those contracts up and say, "Good luck. You're up. You're on your own." >> Oh, >> how are they not looking at this? >> How do they not have somebody who can who has an internet connection who can like do some basic research? How are How do they not know this? >> It's called foolishness. It It really is. I mean, it's arrogance and foolishness that for whatever reason, they're special enough that things can happen to other people, but it won't happen to them. And and that's just foolishness. There's no wisdom in that at all. There's no acceptance of reality and there's no love of truth. That's the only way I know how to explain it. It it's it's mindboggling to me. Well, lots of foolishness out there. So So maybe we get back to the age of wisdom, but it's going to be a bumpy ride, I think. Um, but for people who can see it coming, Paul, I think there there's obviously lots you can do, lots you should do, and and if I had one more, Martinssonism, at times like these, no decision is a decision. Oh, well said. Well said. You can't freeze right now, right? The fight or flight, you know, fighting is better than the flight. Fighting or flight is better if you flee into the right area, but you can't freeze. You cannot be like a deer in the headlights. You cannot let fear rule your mind. You have to take those emotions, put them in check, and develop a strategy. It doesn't matter if that strategy is not perfect. If you have no strategy, and you develop a strategy that says if this happens, then I can do this, this, or this. And unfortunately, this is what I have to do for people, but this is what they need to do for themselves if they're if they don't have somebody that can watch out for them is constantly say, "Okay, this is where we think things are going, but what are the variations of this?" Right? What's worst case scenario? What would cause me to change my mind in my opinion? I'm constantly like the scales of justice putting four so you can stay out of confirmation bias. I'm putting, okay, what's the evidence that my theory is correct? and you search hard. And it's so hard, Chris, with the algorithms now. You have to actively work to try to counter your theory and find the negatives that would cause you to change your mind. And I believe that that's wisdom. It takes work. It takes a lot of thought that people don't like to do. People like to be told what to do, unfortunately, today. They want a multiple choice test. You're not going to be able to na navigate the future with a multiple choice test uh uh mind frame. you're going to have to have a full, you know, essay for an answer so that you can adapt going forward. And the one thing that I want to encourage people out there, you know, there are certain investments that are immoral. Okay? I don't want to have anything to do with those. But there's so many asset classes and there's so many investments that people will say, I don't ever want to own that. You know, I've got people that's like, "Well, I don't ever want own emerging markets because of the fact that it might have some China in there and China's our enemy." Well, that may be the case, but are you more concerned about your moral stance or protecting your purchasing power? Because if you lock all these investments out to where you're in this one little box right here, then if we get the dollar crisis, if we get the inflation that's expected to be coming, then at least be ready to accept the consequences of closing those investments out. because those investments are tools and trying to get people to forget the narratives, focus on what's morally right, and use these as tools to protect your purchasing power because you're going to need it in the days ahead if if if our leaders continue to take us down this path. And and as for me, you know, I hoped that Trump was going to do some of the things that he said he was going to do, but that's not the case. So, I don't see anybody on the political emergence in the future that's going to change the direction of anything. Like you said, they're going to do this as long as they possibly can until they can't do it anymore. And it's up to us to develop strategies to manage our wealth prudently because that's unfortunately what we need in our society today to help shield us from some of these things that are coming. And if you manage it foolishly and and you don't love the truth, it's it's going to be a pretty miserable journey. >> It is. And so it as we close up here, Paul, I would like to just take the opportunity to let people know that uh if you enjoy these podcasts, sort of the style of thinking and um and the preparation that goes into them. Also understand that at Peak Prosperity, uh I'm there 7 days a week and I'm constantly scouting the world for people. And also I have a new offering out called the Renaissance Report which is coming in which um the first volume is coming out uh in a couple days now from the time of this recording and and that's me taking a deep dive into all these things. The point of it is to distill what's actually happening and figure out as best I can what's going on so you can make decisions. And I've got a long track record of success out there. I've been doing this for a long time. And but most importantly these days Paul the number one thing that I think the top value of this is it's not AI generated. I every word I write you know I I will I don't think AI delivers us anything other than insights that it's already sort of centridedly found from other people's thoughts. You're going to need real actionable intelligence coming from real people. And that's that's the service that I'm offering um now at this point in time. So, if you want to know where the puck is going, um, you know, I've got a I've got an offering you should consider. And with that, Paul, as well, I should tell people if they want to talk with you and your amazing team and get that plan so they have a plan that they can invest, not their emotions, they should go to peak financial investing.com, fill out a simple form, and somebody from Paul's team will then email contact you or phone contact you, depending on how you prefer, within 48 business hours, and set up the first of three calls. An introductory call, a planning call, and if it goes further, then a recommendation call. And that's the process. A lot of people have been calling in lately. So, >> Oh, yeah. It's It's been good. It's been busy. I love it that way. Um, you know, and and again, for the listeners that are out there, it takes a while to get on my schedule sometime, even John, Dylan, all of us on the team, because we make sure we keep capacity in our schedule for the clients that we're serving because that is our first priority, first and foremost. But once you get in, then you become same a part of that same family where we make sure that we can communicate, help keep you on track. And and I'll tell people out there, I mean, I've run into several people over the past couple of years that I'm like, "Hey, right now, because of where you are, it's not appropriate for us to work together. But if this and this happens, let's reconnect again." Some of those people were reconnecting again, and we're starting to implement those strategies for them. So, you know, there's there's nothing pressure about anything we do. Our only objective is to help you make wise decisions, understand where you are, and be prudent managers of your assets. And if we're if it's appropriate for us to serve you on the other side of that, that's wonderful. If not, you're still better off and better armed for the days ahead by going through that planning meeting. >> Fantastic. All right. Well, Paul, thank you for your time today. Thank you for all you do for all of the clients that you have. And thank you everybody for listening. We'll be back with another FinanceU next week. So until then, bye for now and hope you enjoyed this show and um leave the comments down below. We always read them and attend to them. Thanks for now. See you next time.