1
00:00:00,320 --> 00:00:03,839
Welcome to the Chicks on the Right
show. We are super excited today to

2
00:00:03,839 --> 00:00:08,880
have with us Philip Patrick from Birch
Gold because Philip, there's some stuff going

3
00:00:08,960 --> 00:00:13,800
down that's not getting a lot of
airplay. But like just within the last

4
00:00:13,800 --> 00:00:19,800
few days, the FDIC has just
sort of quietly under the radar announced the

5
00:00:19,839 --> 00:00:23,800
first bank failure of twenty twenty four. I don't know why it's not getting

6
00:00:23,839 --> 00:00:28,120
talked about more so, what can
you tell us about why it collapsed?

7
00:00:28,320 --> 00:00:31,679
Yeah, you're first of all,
you're right. It was surprisingly quiet,

8
00:00:31,760 --> 00:00:37,200
almost swept under the rug. So
Philadelphia based. It was a bank called

9
00:00:37,240 --> 00:00:42,240
Republic First. They had thirty two
branches, about four billion dollars in total

10
00:00:42,280 --> 00:00:46,719
deposits. By the way, a
little over half of those deposits were uninsured.

11
00:00:46,880 --> 00:00:52,200
So what happened the bank failed.
The FDIC arranged a takeover by another

12
00:00:52,280 --> 00:00:57,119
Pennsylvania base bank and they kicked him
out. Six hundred and sixty seven million

13
00:00:57,200 --> 00:01:02,600
dollars of its deposit insurance fund over
to support them. And it looks like

14
00:01:02,840 --> 00:01:07,840
at this point even the uninsured depositors
are going to be made whole. Now

15
00:01:07,319 --> 00:01:11,920
this bank has been and I know
it's crazy. This bank's been in trouble

16
00:01:12,000 --> 00:01:18,280
for quite a while. I have
no doubt they're on the FDIC secret list

17
00:01:18,400 --> 00:01:22,680
of fifty two problem banks. And
here's why. Right, we've got this

18
00:01:22,799 --> 00:01:27,920
combination of rising interest rates and falling
commercial real estate values, especially for these

19
00:01:29,000 --> 00:01:34,159
office buildings that are really struggling post
COVID, and what we're seeing is a

20
00:01:34,239 --> 00:01:38,920
heightened risk for the entire banking system. We see loans that are backed by

21
00:01:40,000 --> 00:01:45,079
properties that have lost value make them
very challenging to refinance. And essentially,

22
00:01:45,120 --> 00:01:49,000
banks have been counting on interest rate
reductions from the Fed this year because they're

23
00:01:49,040 --> 00:01:55,319
still sitting on about half a trillion
dollars in unrealized losses, so lowering interest

24
00:01:55,400 --> 00:02:00,000
rates would really help the banks rate
now. But the latest inflation reports almost

25
00:02:00,120 --> 00:02:04,400
since October have made it look like
we're going to have higher interest rates for

26
00:02:04,480 --> 00:02:09,000
longer, and I think that virtually
ensures more bank failures this year unfortunately.

27
00:02:09,960 --> 00:02:14,479
Okay, so does this mean more
bailouts? And if so, I mean,

28
00:02:14,479 --> 00:02:16,479
can we handle that with all the
inflation that we have. That's a

29
00:02:16,599 --> 00:02:23,000
really good point, and I think
more bailouts are certainly a possibility given I

30
00:02:23,039 --> 00:02:27,159
think more failures on the horizon and
I don't think the government want to let

31
00:02:27,240 --> 00:02:30,520
depositors lose money, because if they
do, there'll be a run on the

32
00:02:30,560 --> 00:02:36,919
banks and the problem gets much much
worse. But your right to be concerned.

33
00:02:36,919 --> 00:02:40,680
Bailouts at this point are certainly going
to drive inflation higher, right,

34
00:02:40,960 --> 00:02:46,800
As I mentioned before, it's crazy, right, more spending. But I

35
00:02:46,879 --> 00:02:52,719
mentioned before like the US banking system
is already very fragile, any increase in

36
00:02:52,840 --> 00:02:58,159
rates at this point I think will
threaten to cause another wave of bank failures.

37
00:02:58,159 --> 00:03:04,080
And I think that's why the FEDS
stopped raising rates shortly after SVB collapsed

38
00:03:04,159 --> 00:03:07,719
last year. So you know,
they're in a very tough position, and

39
00:03:07,759 --> 00:03:12,680
they're facing a tough choice. They
can do nothing and let inflation continue to

40
00:03:12,719 --> 00:03:17,599
smolder. They can raise rates to
fight inflation, but risk destabilizing the banking

41
00:03:17,639 --> 00:03:22,520
system, and I think ignite another
recession. Given the choice, though,

42
00:03:22,560 --> 00:03:27,719
I think they're always going to choose
systemic stability over the American family. If

43
00:03:27,759 --> 00:03:30,080
we ever doubt this, we've just
got to remember who got bailed out in

44
00:03:30,120 --> 00:03:35,199
the Great Financial Crisis, right,
Okay, Well, so then I'm a

45
00:03:35,240 --> 00:03:38,599
person who who has been waiting and
waiting and waiting for these interest rates to

46
00:03:38,599 --> 00:03:40,919
get cut because I'm going to be
taken out a new mortgage at the end

47
00:03:40,919 --> 00:03:46,439
of the year. So is the
what do you think is going to happen

48
00:03:46,560 --> 00:03:50,879
with the rates? It's so tough
to work out. Look, one thing

49
00:03:50,919 --> 00:03:55,280
that's very clear is rates at the
current levels clearly are not doing the job

50
00:03:55,319 --> 00:04:00,319
to tame inflation. Like I said, it's been going up consistently six since

51
00:04:00,360 --> 00:04:04,120
October. So I think this idea
of speculating about lowering rates I'm sorry to

52
00:04:04,159 --> 00:04:11,159
break the news anytime soon seems a
little bit insane. Outside of your mortgage,

53
00:04:11,199 --> 00:04:14,319
I think for that they should look
at doing it. But you know,

54
00:04:14,520 --> 00:04:19,120
from an inflation standpoint, just for
you, I don't see it.

55
00:04:19,319 --> 00:04:25,160
Inflation is basically double the Federal Reserves
target, and at this point it looks

56
00:04:25,199 --> 00:04:29,600
like it's becoming entrends. Expectations are
that prices are going to keep rising,

57
00:04:29,639 --> 00:04:34,360
and I think it seems realistic.
Cumulative inflation under the Biden administration has been

58
00:04:34,399 --> 00:04:40,600
about nineteen percent, averaging about six
percent a year, and the last numbers

59
00:04:40,639 --> 00:04:44,480
coming out of the Fed were terrible
as well. So, like I said,

60
00:04:44,720 --> 00:04:47,040
it puts the FED in a very
tough position. They could raise rates

61
00:04:47,319 --> 00:04:51,319
torpedo the banks, and I just
don't think they're going to take that route.

62
00:04:53,040 --> 00:04:57,920
Lowering interest rates means surrendering the fight
to inflation, which I don't think

63
00:04:57,959 --> 00:05:00,240
they can do publicly. So I
think at this point it's going to be

64
00:05:00,240 --> 00:05:05,839
a case of leaving rates where they
are and just hoping that things subside.

65
00:05:06,160 --> 00:05:11,360
It hasn't been successful so far,
but I don't see too many choices for

66
00:05:11,399 --> 00:05:15,439
the Fed. Wow, my god, that's just a depressor. OK.

67
00:05:15,120 --> 00:05:19,720
So tell us why is gold as
smart investment for people? Look, golds

68
00:05:19,759 --> 00:05:24,639
shooting up in this climate, and
it is because of the climate. These

69
00:05:24,720 --> 00:05:30,839
problems that we talk about inflation,
We've talked before about dollar devaluation, potential

70
00:05:30,879 --> 00:05:34,680
recessions on the horizon. These things
are all very negative. Of course,

71
00:05:35,000 --> 00:05:42,600
that they drive very positively safe haven
assets like gold and silver. On top

72
00:05:42,680 --> 00:05:47,639
of that, we're seeing unprecedented demand
I've mentioned before from central banks twenty two

73
00:05:47,920 --> 00:05:55,000
twenty three also heading into this year, more gold buying by central governments than

74
00:05:55,120 --> 00:05:59,199
any other years before in history.
And it's partly for the same reasons.

75
00:05:59,279 --> 00:06:03,519
Right, we're alting our dollars to
other countries. They feel our inflation as

76
00:06:03,600 --> 00:06:10,240
devaluation and a loss of purchasing power, and they're hedging their dollar exposure with

77
00:06:10,399 --> 00:06:15,759
gold because things like inflation drive gold
up, and that's how people protect their

78
00:06:15,759 --> 00:06:20,639
purchasing power. And it's working in
today's climate well. And it's why especially

79
00:06:20,680 --> 00:06:25,959
for people who have thought about investing
in gold or other precious metals but don't

80
00:06:25,959 --> 00:06:29,199
really understand the mechanics of it.
You guys have always been so good at

81
00:06:29,199 --> 00:06:33,279
Birch Gold about teaching people and offering
that information for absolutely free. If you

82
00:06:33,360 --> 00:06:39,120
text nine eight nine eight nine eight, or you text the word chicks to

83
00:06:39,240 --> 00:06:42,680
nine eight nine eight nine eight,
you can get that free information, that

84
00:06:42,759 --> 00:06:46,079
free gold kit to tell you all
about how to invest in gold. One

85
00:06:46,079 --> 00:06:49,839
more quick question, just because of
the whole bank collapse thing. Should people

86
00:06:49,920 --> 00:06:55,759
be more feeling more secure with their
money in big banks like the Chases and

87
00:06:55,800 --> 00:07:00,319
the pncs or should they be looking
to credit unions and smaller It's like,

88
00:07:00,360 --> 00:07:04,800
what is the safer choice for me
at this point? That's a tough question

89
00:07:04,879 --> 00:07:08,959
to us. But I've always heard
on the side of big banks. I

90
00:07:08,959 --> 00:07:11,480
mean, look, at the end
of the day, too big to fail

91
00:07:11,959 --> 00:07:16,120
is a thing right in the government. I think any big institution looks shaky,

92
00:07:16,199 --> 00:07:19,560
I think the government will step in
and bail them out. Quite honestly,

93
00:07:19,839 --> 00:07:23,720
I think they'll do that for the
smaller banks as well. Like I

94
00:07:23,759 --> 00:07:28,240
said, if they let depositors lose
money on one or two banks, you

95
00:07:28,279 --> 00:07:30,720
know we're going to be waking up
tomorrow going to our bank accounts trying to

96
00:07:30,759 --> 00:07:34,639
withdraw funds. And that creates a
bigger problem than the FED can handle.

97
00:07:34,759 --> 00:07:40,399
So I think they'll continue to bail
out. But we know what that means.

98
00:07:40,480 --> 00:07:44,879
That means more inflation, more loss
of purchasing power. There isn't and

99
00:07:44,959 --> 00:07:46,759
I hate to be the bearer of
bad news all the time, but there

100
00:07:46,800 --> 00:07:53,240
isn't really a positive outcome here.
We have hardship in one form or another

101
00:07:53,319 --> 00:07:57,360
to get through, and it's just
about how to weather that storm. And

102
00:07:57,879 --> 00:08:01,720
I think Gold does an incredibly good
job of doing that. Yeah, people

103
00:08:01,959 --> 00:08:05,720
forget that, Yeah, ye that
Yeah. Text chicks to the number nine

104
00:08:05,800 --> 00:08:11,000
eight nine eight nine eight and that's
nine eight nine eight nine eight. Do

105
00:08:11,120 --> 00:08:15,759
that because Birch is the place to
do it. Thank you, Philip.

106
00:08:15,800 --> 00:08:18,519
We always appreciate all of your insight. Thank you for having me, guys.

107
00:08:18,560 --> 00:08:26,360
I always enjoy it very much,
thank you