Speaker 1: So Zach Abraham, chief Investments for Bulwark Capital Manager, is
going to join us and Starbucks man utter nazis.
Speaker 2: This is so utterly abusive to employees.
Speaker 1: So we'll talk about that with Zach because of course
he's on boards of companies and he's a fiduciary, invests
my money, on our families money and other people's money.
So we'll talk about But plus, he went through on
his Twitter and he was professor Zach unrealized gains and
losses and investment securities and what does that mean for us?
Speaker 2: And why is it insane? And why do we care?
Speaker 1: Then this what we're lacking in credit creation is being
more than accounter for with seven percent deficits. Let's talk
about that. That seems rather important leading up into an
election at all. But I think we'll also get quickly
into what things can we look at to determine how
bad or good the economy is, because the people who
run things would rather us not not see those things.
We'll talk about this with the help of our YouTube
channel YouTube dot com slash at the Todd Herman Show,
and of course with a great grace of God Almighty.
Speaker 2: Let's begin.
Speaker 3: The Todd Herman show is one hundred percent disapproved by
big pharma technocrats in tyrone s everywhere from the high
mountains of Free America. Here's the Emerald City XI Todd Herman.
Speaker 1: Today is the day the Lord has made in These
are the times through which God has decided we shall live.
Zach Abraham joins me. He's the chief in investment officer
of bowl Or Capital Management. On Noel learned to speak.
Someday maybe when I'm not multitasking looking at a stupid
computer that will not behave Zach wilcome back to the
Todd Herman Show.
Speaker 4: Always good to be back.
Speaker 1: So, man, I don't know what to say about these
people at Starbucks and what they're doing to these employees.
This is unexpected and it's not like me to want
to come out and defend Starbucks, given you know what
they are politically, et cetera. But they came out with
a heck of an announcement. And do you want to
break it to the people you want me to?
Speaker 4: Yeah? You you take it? Yeah? Okay?
Speaker 1: I mean because I'm the professional broadcast so you have
a great, big radio show and I'm talking about your
ratio is huge, all right, it's this Starbucks, Warrens corporate staff,
show up an office or get fire. The golden era
of remote work seems to be ending. Starbucks is the
latest mega corporation to enforce a return to office mandate
for white collar workers.
Speaker 2: People have got to revolt on this thing, Zach.
Speaker 1: I mean, there's just this, there's no way around that
you have to be able to work from home.
Speaker 5: This reminds me of the old line that you know
from time to time, the tree of liberty, Blood of tyrants. See,
we've got we've gone over the event horizon of madness here.
And I was reading it not just Starbucks, that this
is the same headline as is occurring in another company
as well, and it's escaping me right now where it was.
And this goes to you know, I think you and
I've discussed before, We've talked about it on our show
as well, which is, Look, you didn't just turn a
corner and all of a sudden, this is a work
from home economy. I think that they're working from home
going forward will be more prevalent in certain industries, less
prevalent in others.
Speaker 4: It is a permanent fixture in the sense.
Speaker 5: It's not going away, but there are some jobs as
an employer, you know there are there are some jobs
where there is a noticeable advantage of having people together, collaboration, talking, communication,
people like going do it on zoom and.
Speaker 4: It's like it's I come on right, it's not even
close to the same.
Speaker 1: Yeah, And there's something to be said for proximity to
human beings, right yep. And now my radio company, when
I worked in morning radio, Shodow and I worked in
the same building. You were there as often as I was.
They made this attempt to have us all come into
the office place. And a lot of us were working
out of states because of COVID all that, And at
that point I understood what they were trying to do.
We need to have a collegial workspace.
Speaker 2: We need people to work collaboratively. And I was talking
to the HR lady.
Speaker 1: I have nothing, no disparaging remarks to make whatsoever, not
just because I signed the non disparagement agreement that's binding,
because I don't. But I talked to this lady at
a jelly lover, great great human being. HR lady, I said,
but people hate each other. She said, well, but that's
what we're trying to fix. I go, no, no, no, no, you
can't fix. You can't fix an office that's eighty five
percent a radical socialist communist and fourteen percent conservative and
two percent libertary and one percent libertary. You can't do it.
You understand something people hate each other, that that's gone.
You can't fix that. You'd have to completely change the
office out and bring in absolutely new people and guide
it as a building. But do you think working in
proximity to one another prevents that if you have healthy,
decent leadership. I mean you guys reviewed leadership. You look
at leadership teams all the time.
Speaker 4: Yeah, no, I look.
Speaker 5: Wild deliver in a world that is literally where the
woke agenda is now calling into question the efficacy of
brown versus the Board of Education, right, which is you know,
the re segregation of college campus right. So I mean
you've got to take that into context. Yes, in this world,
I think that division and separation only exacerbates the issues.
Speaker 4: I think it is great to have.
Speaker 5: For instance, it's easy to us for us to myopically
look through a lens, but let's roll with it. One
of the I think one of the easiest over time,
one of the easiest ways to bridge the political divide,
for instance, to convince let's say, young, really woke people
that anybody that disagrees with them isn't evil. Let them
work in an office with these people and see that
they can give money to poor people, they can give
to charitable causes.
Speaker 4: They're good people, you know what I mean.
Speaker 5: Like it humanizes things, and on all levels, that's always
a helpful thing. I think it's so often or not
we characterize people that disagree with us with the most
outrageous version of that disagreement, rather than seeing the normal,
well intended people that actually make up the vast majority
of supporters of whatever that you know what I'm saying,
whatever idea that is, you know, And we can even
do it as a little thought experiment here. The average
Kamala Harris voter, the average is not somebody that wants
to decimate the Bill of Rights or rip down free markets.
Speaker 3: Right.
Speaker 5: The average Kamala Harris voter, the average one waits certain things.
Speaker 4: Now, whether they're right to do this or not, we
can discuss it a lot. Obviously.
Speaker 5: I think most of the listeners know you're in my
opinions on this, but they're not evil people. The average
Kamala Harris Fold. Are they backing something that's particularly evil?
I think so, right, that's my opinion.
Speaker 1: You know who they are average? Can I tell you
what I think they are? What terrified?
Speaker 4: Yeah, i'd agree, I would agree.
Speaker 2: Right, And I mean, and you and I were garbage?
Speaker 4: Well apparently, did you know by the way I watched it.
Speaker 1: I watched this time and we watched this really closely
the other day. I think it was Wednesday that went
up on our three story segment. Right on Wednesday. He's
reading that. He's reading that statement, Zach someone wrote that
for him. I mean, you watch his black Reptilian Parkinson's
impacted medicated eyes.
Speaker 2: Joe Biden is reading that statement.
Speaker 1: It looks like it, yeah, which makes it worse.
Speaker 4: It does.
Speaker 5: But it's one of the reasons why I'm doubting that
he would read it, because that means the staff prepared
that for.
Speaker 1: Oh no, no, no, no, oh. I just I think
he's so far gone. I think he's so complete and
he could read that note. And I'll confess something to
you now, this is a confession to this audience. I
don't like polling data. I mean I used to do it.
I ran a big data company. I sold a big
data company at one point. I found it very interesting.
But because they don't trust political polls, because they don't
believe in the networks that do them. We used to
in radio be told you have to do one polling
show per week. Okay, so one day a week, you
need to do a show that's intense on polling. I'm like,
you're telling me, as a program director, I need to
talk about things they don't care about. And program director said, yes,
but you're really good at it. You have really good
insights on polling and data ready, and this is a
true thing. I did an hour on polling as prescribed.
I argued it down to one hour, not a whole show,
one hour, and I got done with that hour and
it was wrapping up the show. I wrapped up with
the personal note like I used to do in radio,
and I said to my producer, did anything I say
make sense? It's like what I go. Did anything I
said today make any sense whatsoever? Because Yeah, I thought
it was a great show. It's very interesting, dude, I
had no idea I was. I mean, this was an
autopilot show and I just turned my brain off. Biden's brain,
I think is medically off man and so hey, sit down,
read this, he can read it. And then probably sixteen
seventeen minutes later, I think I called people garbage.
Speaker 5: Yeah, it's a strange it's really a strange place that
we've gotten ourselves into. Meaning, you know, it kind of
goes into what we're talking about, like the vitriol, the
vitriol that is embodied in this pre I mean, getting
to the point where you're called I mean, let's think
about this. It's so we have a system and a
media that is so focused on one side, not the other.
The sitting US president just referred to fifty percent of
the US populace as garbage.
Speaker 1: And then the political said that he didn't say it.
What they said is that he referred to the hatred
of Trump supporters as garbage.
Speaker 4: But the problem is is that's not what he said.
Speaker 2: I know, I know that's what he said.
Speaker 4: I know.
Speaker 5: Now the White House, now the White House has changed
the transcript.
Speaker 1: Which is illegal. Yeah, it's illegal to aulter a presidential transcript.
Speaker 5: Look, everybody and see here, here's here's the political idiocy
of the left right here. Okay, everybody and their mother
knows the guy's not right. In his mind to come
out as folk, right. I mean they're making it so,
they're making it so much of a bigger like it
should be a bigger like it should be a big thing.
Speaker 1: Don't get me wrong, right, but just as folk days
before the election, they should just come along and say,
you know what we needed to go. Simcinia, he's got
Parkinson's real bad like. He doesn't know where he is.
He he thought he was Kamal Harris when he was
reading that. He actually thought he was Kamal Harris. We
have an economy that's going to be effect by all this,
and whoever wins or is installed as it were, I
need to talk with you about the way.
Speaker 2: There's a great article in the show notes.
Speaker 1: We won't get two into it because it's really long
article about how the government is constantly constantly changing and
altering economic data to make it look better. So we'll
talk about Zach about this in a second. Since it's
the economy. Let me tell you this and this. I
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to win up to one hundred dollars in free product
from Bioptimizers. So Zach, there's a great article at zero
Hedge about many of the ways that the government gaslights
people about the economy. And it relates to unemployment numbers,
it relates to inflation numbers, it relates to calculations of
the GDP taking this product set out. For instance, they
were making the case that inflation are not gone up.
But oh, by the way, we remove staples like food
and energy from the GDP data so that they could
claim that, just like they did with the crime statistics,
the FBI removing major cities from that. So how can
we as Americans? How is how can we as Americans
really make sure that we're not getting gamed? Like what
can we look around us and say, Okay, the economy
is in bad stead.
Speaker 4: Man, that's a tough question.
Speaker 5: And in the past, I mean they were, I mean, shoot,
in the past a lot of times the United States
users look at the stock marketing and we tell you
the story that's been gained to a certain extent, it's
a little bit tough. But this goes to one of
the things that we've been talking about a lot. And
there's a there's an interesting article out here that I
want to pull up for you on the exactly on
this topic. It's funny because I just tweeted about this,
but it says it's from the economists, and it says,
quote unquote, sentiment is weak, almost at the level you
might expect if the economy were in a state of recession.
That's one of the biggest data puzzles out there. Okay, well,
I can't tell you definitively. Whenever we're discussing the economy,
people need to keep in mind and you can agree,
you can disagree with me all you want. I did
at the beginning of my career, and I have learned
over the last sixteen or seventeen years that whether I
agree with it or not, it doesn't matter.
Speaker 4: This is true.
Speaker 5: There is no more dynamic complex system in the world.
In the world now there's life is a more nature's
techickly a more complex system. But in terms of man
made systems, there really isn't a more complex system with
more variables than an economy. The inputs are just incredible
in terms of the numbers of them, which makes it
why it's so hard to have economic predictions.
Speaker 4: Right.
Speaker 5: But what we were saying was that when you that
headline from the Economist does not surprise me at all.
Why because you're running seven percent deficits, meaning.
Speaker 2: You've got to explain this. This you tweeted about this.
Speaker 1: I'm sorry to interrupt you, but this is so vital
and important to understand. Let me stop quick with sentiment.
You're saying sentiment is weak. So this is people's trust
in the economy. So p so the distributed wisdom and
emotions of Americans are saying, hey, you know what, things
don't feel right? Okay, And then you're explaining this mathematically
with these seven percent deficits.
Speaker 4: Yeah so, And quite honestly, sentiment indicators have been fairly good.
Speaker 5: Every data set has its has its, you know, good
parts and bad parts. And there is no and I
repeat this, there is no one hundred percent accurate economic
indicator on the face of the earth period full stop.
Speaker 4: Okay. But sentiment indicators historically have been pretty good.
Speaker 5: They've been really bad over the last twelve to thirteen
years predicting recession.
Speaker 4: Why.
Speaker 5: There's several reasons why, but one of the biggest reasons,
in my opinion, is that government and central banks have
taken a much more central role. When you understand how
we measure economic output, which is GDP, right, gross domestic product.
Speaker 4: And we've talked about this.
Speaker 5: Before on this show, and I've talked and I'm going
to oversimplify it for the sake of brevity, but when
you understand the way GDP is calculated, it really is
the summation of virtually all transactions that happen inside of
an economy over a given period of time.
Speaker 4: Okay.
Speaker 5: So when a government begins to spend seven percent deficits,
and when that government its deficits have averaged historically one
and a half to two and a half percent, okay,
that is going to set off. That is going to
show GDP going up, right, because it's pouring cash into
a system right.
Speaker 1: But just got it. Okay, just before you said it,
I'm like, oh, of course, deficit spending seven percent? Oh look,
ching every transaction. Oh oh wow, we're good. This is
adding up. This is economic activity. Right, Paying our debts
or not even paying our debts, paying to float the
interest on our debts, right, paying the credit card minimum
every month and not even that in our case is
economic activity.
Speaker 4: Right? So what did we so?
Speaker 5: An easy way to look at this lot so is
what did we see from the end of two thousand
and nine to twenty twenty, right, what did we we
saw on a stock market going ballistic, rich getting richard
and they've ever been record low wage gains for Middle America, right,
and record slow growth coming out?
Speaker 4: Well, why was that same basic dynamic?
Speaker 3: Right?
Speaker 5: Because, and here's the catch, this is why you'll get
good economic readings with bad sentiment. Where does that deficit
spending go to? It goes to companies and places where
the government does business with. It doesn't filter through the
economy like normal GDP would.
Speaker 4: Right.
Speaker 5: Like, so let's say we have a productivity boom, Okay,
all parts of the economy virtually are going to be impacted,
usually in a positive way. From a productivity boom, whether
it comes from the Internet, new technology, whatever the case
may be. Whereas with deficits spending, you're going to have
the people that are or the people in corporations that
are receiving that are beneficiaries of that deficit spending, and
then you're gonna have people that aren't.
Speaker 4: Right, it's very bifurcated.
Speaker 5: And so what we would expect, and one of the
things we were talking about is in a big deficit
environment like this, we expect to experience periods of time
with sentiment and house holding, net worth and all these
other things where it looks and feels like a recession.
Speaker 4: But GDP is still going up.
Speaker 5: And as deficits become bigger percentages of the economy, that
anomally should become more and more present, right because because
it'll make the economy look less and less cyclical, because
that that government spending is as steady as a clock.
Speaker 1: Well, so this is a massive economic lie. And if
you're listening to this, by the way, versus watching it,
Zach Abraham's with a chief investment officer Bulwark Capital Management,
new Uroscrity dot Com. All right, let me expand this. Then,
so the Bible tells us to be really really careful
about debt and usery, maybe don't charge people users' rates
and be ready to forgive loans and the seven year jubilees,
whereas our society, if I to understand this correctly, are
seven percent deficit, is economic activity that softens a weak
economy's appearance, because hey, look it's it's it's it's economic activity.
Speaker 4: Air go.
Speaker 1: Then it would seem to me that one of the
things that the central banks really like are people paying
the monthly minimum on their credit cards because it's repeating
cyclical economic activity that ain't ever going to stop. And
sure there's some bankruptcies here in there, but they don't
really care about that because this is just French cases.
Plus they're just little people. I mean, they're just an
ordinary folk. It doesn't really matter if they go bankrupt.
So that's revolving credit line thing, minimum bounces on your
tire credit card, your gas credit card, store credit cards,
visa MasterCard. That's also economic activity, albeit stalemating hamster wheel
I mean usury or if you like, it's almost like
sharecropping in a way.
Speaker 5: Yeah, yeah, And I mean look, and it answers so
many questions. And look, again, these are very complex things.
So are there is there more to it than this? Yes,
but it's a big it's this is the lion share,
you know, part of what we're seeing right, Like for instance,
just all you have to do is go back and
look at World War two. Go look what happened to
gross domestic product in World War two went through the roof. Right,
that's the last time we were running seven percent deficits. Okay, Now,
a little bit different then because you didn't have automation, right,
So literally every bit of that production what was feeding
back into the consumer's pocket, right, because you had to have.
Speaker 4: People making all of these goods.
Speaker 5: You didn't have machines doing it, you didn't have factories
in China doing it, right, So the feedback loops were
going right back into the main economy.
Speaker 4: Today that's not the case.
Speaker 5: It's feeding right back into the corporation's hands, therefore the
wealthy's hands. But now, is there some trickle down effect? Yes,
there is, there is some trickle down effect.
Speaker 4: But what we're.
Speaker 5: Saying is if we look at a normal economy that,
let's say in America is growing at four percent, right,
everybody feels good go back to two thousand and six,
two thousand and seven, we're cranking along three three and
a half percent GDP.
Speaker 4: We're in there.
Speaker 5: Everybody felt good, right, every part of the economy was
doing well.
Speaker 4: It was about to get bad, but everybody felt good.
Speaker 3: Right.
Speaker 4: How is it that we're today where GDP numbers are
above that, household net worth and numbers are above.
Speaker 5: That, wages have gone way up, and yet sentiment readings
today are nothing like you saw on six o seven.
Speaker 4: Why is that?
Speaker 5: Well, because the delta between GDP and how it's affecting
consumers is much larger than it was then, because so
much more of the GDP is government deficit spending, right,
and that's not having so you so on the surface
of it, you go, well, the last time GDP was
expanding like this, it was the best of times. We
were like, yeah, but that was real GDP growth, that
wasn't just deficits spending.
Speaker 4: Right.
Speaker 2: It's almost this extraordinary for people to understand.
Speaker 1: We have built in our in our in our economy,
the most labyrinthine and broad set of perverse incentives that
have ever existed in mankind's history, and.
Speaker 5: We've created We've created an economic Potempkin Village on top
of it.
Speaker 1: Okay, so people, some people know what Potempkin Village means.
Other people don't. Alex Overall, who's a very smart young man,
produces the show now because nine is moving on to
a bigger, better career or different care I should say
bigger better. It's bigger better. You don't look at me
that way, young lady. We're very proud of you. We're
very very we're thrilled to I've had you.
Speaker 5: Hear.
Speaker 1: But so Alex doesn't know what Potentmkin Village means.
Speaker 5: Okay, So Potempkin Village goes back to the the the
what would you call it? The the the I'm forgetting
the name, but Russia, back to Russia when they have
these art right yep. And I'm forgetting exactly who it was.
But Petempkin was like or was it No? Was it
was it Rasputin? Or I think it was named after
the guy Patempkin. Anyway, he was like a Department of
the Interior, kind of like a Rasputin like character, and
we really wanted to ingratiate himself with the Tsar.
Speaker 4: It might might have been actually been Catherine the Great.
Speaker 5: I gotta go brush up on the story anyway, Long
story short, he's supposed to be developing the interior.
Speaker 4: He's not doing a very good job.
Speaker 5: But what he does instead is he goes around the
countryside setting up all of these false front buildings, right,
and so then he drives through the country and he's
showing the queen or the tzars or whatever it is, like, hey.
Speaker 4: Look at everything that we've done. Well, you know, it
was just a facade. It was like in old West towns, right,
how they are the false fronts, right?
Speaker 5: So yeah, so on the surface it looks like one thing,
but you know, when you look behind it, there's other.
Now I'm not saying it's fully a Potempkin village because
the GDP readings are accurate.
Speaker 4: Okay they're not. They're not falsified.
Speaker 1: Oh wait, hold it please, I love you so much.
You're the greatest economic mind I know. Until the government says, gosh,
inflation's up, could we go ahead and remove some of
the measures like core items like oh, I don't.
Speaker 4: Know food, right, but that's inflation numbers.
Speaker 1: Okay, right, but the GDP is up, okay, got that,
But this other lever we look at inflation.
Speaker 2: Oh, that's that's mine. So GDP's everything.
Speaker 1: Inflation is all the things, accept the things you need
to live.
Speaker 5: Right, So those numbers affect what we call real GDP,
which real.
Speaker 4: Yeah.
Speaker 5: Real GDP is the nominal growth number less inflation.
Speaker 4: Okay, so you got a minus inflation from it. That
gives you a real number.
Speaker 5: But what I'm saying is the nominal GDP number is accurate.
Speaker 4: Okay, it is accurate. Okay.
Speaker 5: What isn't in my opinion, and I think that there's
a preponderance of evidence to back this up, is the
inflation data.
Speaker 4: Okay. And we've talked about this on the show before.
Speaker 5: Well, if my inflation data is incorrect and it's understated,
then my GDP number could be accurate and properly stated.
Speaker 4: But it's only as good as the inputs.
Speaker 5: Right, So if my inflation data is in correct and
it's artificially understated, then GDP real.
Speaker 4: GDP is going to come in artificially high. Right.
Speaker 5: But it's not because they're screwing with the GDP numbers.
They're messing with the inputs. Does that make sense?
Speaker 2: Yes?
Speaker 1: And I'm just thinking of God's word. I don't remember
what psalmness is but God uses the simple things to
shame the wise, and the weak things to shame the strong.
So I'm listening to this and what you just said
is about thirteen minutes of financial education that should be
core to every single I'm talking maybe ninth grade in
a simplified form, all the way through high school every
year to put on constant as the youngs say, or
and repeat as us old say. So people begin to
understand not much just potentkin village means, but how this
stuff has all been rigged. And Zach Abraham, the irrestrated
dot com Chief investment Officer Bulwark Capital Management, thank you
for that explanation.
Speaker 2: It is one other things I want to ask you,
and it relates to this.
Speaker 1: It's a carry out of this conversation, and it's about
that GDP being complete.
Speaker 2: I'm going to push back on that.
Speaker 1: I contend it's not complete, and I'll tell you why
I mean this in just a second. Okay, Why I
say that there is a GDP that's moving outside this
country and it's part of what used to belong here
is healthcare spending. Now I know healthcare spending goes up
all the time in the United States. Thomas Massey just
showed this chart, Ran Paul showing it. President Trump showed
it on the Joe Rogan Experience. This chart where our
spending on healthcare continues to skyrocket and yet healthcare outcomes
are continued to decline in this country. Well, that's because
it's not healthcare. That's because healthcare is happening outside this country.
Is happening outside this country. And when that occurs, we
lose not just GDP, but we lose respect for our
healthcare system. But it's not like the other countries are
getting better. They're taking our stuff and using it better.
In the case support of art to Mexico, there's a
healthcare clinic there I go to called Renew Healthcare, and
they do one thing, and they do it extraordinarily well.
They source ethically gathered stem cells from placentas and umbilical cords.
They pay for the entire birth cycle of the women
whether or not they use their stem cells because they
only accept about ten percent of stem cells, and then
they culture them in their lab. In Mexico, they have
invested in creating their own oxygen because they want to
know exactly how pure it is. They don't want any
supply chain issues, so they've invested a ton of money.
I've stood in the room where they produce the auctionen.
It is incredible. They have the largest hyperbaric chamber in
North America. When you sit in that, it helps reduce inflammation.
Immediately after they inject you with the stem cells, it
helps activate them drive it into your muscle tissue. That's
all happening in Mexico. It helps people avoid surgeries, recover
so much faster that even can correct traumatic brain injuries,
violent injuries like horse writing accidents, car accidents. It's amazing.
And here it's illegal because our government wants to burn
placentas in aabilical cords. So that portion of our GDP
is where it belongs in a healthcare clank, albeit in Mexico,
which is the part of our to the safest city
in Mexico, I totally endorse these guys. Go to renew
dot Healthcare. It's r E n U E dot Healthcare.
They'll hook up with your doctor here and see your MRIs,
your cat skins, figure out if they can help you,
and they'll tell you if they can, and if they cannot,
they'll say, sorry, we can't. It's renew dot healthcare. So Zach,
let me just push back every so gently on this
idea that our GDP is accurate. All right, how much
are we earning on fentanyl in the country, street fentanyl?
Think about it? And sex trafficking and how much underground
labor is going on in terms of immigration, how much,
how much extortion, and how much actual money laundering. So
let's start with a big one like drugs dugs is
a multi hundred billion dollar business at probably six hundred billion.
Sex trafficking globally is approaching that. In America is one
of the top centers for sex trafficking. Sadly, there's what
six hundred billion plus six hundred bility you're starting to
talk about some like fairly large money.
Speaker 5: Yeah, yeah, those are those are what we call statistically significant.
Speaker 1: Figures, statistically significant figures. Is there anything in finance that
actually tracks that or is there any way to know that's?
I mean, we know what's going on. We could take
that data and apply it. I guess should that be
included in economic numbers? Because you've said, and you've taught
me to believe that a nation's economy is a sign
of its morals, and a moral is the sign of
its economy.
Speaker 4: Yeah, you know, that's an interesting question, man, that's one
I've never gotten before.
Speaker 2: So let's start with an easy one. Should it be
included in our ap.
Speaker 4: Probably? Okay.
Speaker 5: There's two ways to approach this topic, one that is
purely analytical and one that is more cultural and morality based.
Speaker 4: So let's start with a purely analytical one.
Speaker 1: Okay, probably have separate music for this one, like the
Jeopardy theme, and then after us we'll get to a
c DC back and blackers. Okay, so you're going to
say analytically, Yeah.
Speaker 5: So what I would say is probably not on an
analytical basis, and the reason why would be because these
are what we'd refer to is off ledger off. I mean, look,
I hate talking about this stuff because this is you know,
the ruining, the absolute ruining of human lives, the destruction
of human spirits.
Speaker 4: It's horrific, right, But if.
Speaker 5: We want to look at it through an analytical lens,
these are what we'd refer to as off balance sheet
or off ledger transactions, meaning they're they're the the the
the multiplier effect on on that on that economic activity
is going to be substantially different than the multiplier effect
off of normal economic activity, meaning that economic the money
that is produced from those activities is not going to
flow to nearly as many hands. A lot of it
is going to be pushed back outside of the country,
so we'll have way less downstream positive impacts. So if
I was sitting there, if somebody asked me to conduct
GDP and calculate those numbers into it, I would probably initially,
Now the data might take you somewhere else, but initially
my approach would be something like, Okay, here's what we
believe the gross number is. Now we're gonna we're gonna
adjust that number because it isn't gonna it isn't going
to transact like normal GDP, right, So you would want
to discount it to some degree, right.
Speaker 4: Just because a lot a lot of that money is
going to be moved out of the system. It's not
going into banks, it's not creating tax revenue.
Speaker 6: Banks, right, right, So it's laundered, right, and okay, so
you might you know what, as we sit here and
talk about it, Todd, you know what, honestly, and new
factor drugs into it, it's probably a negative GDP impact.
Speaker 2: Because of it leaving the country. Being launched. But there
are banks here who know they're laundering.
Speaker 5: This, right, And the cost well, and remember the costs
assigned by both are still being the costs that are
inherent in both, right, both societally law enforcement wise.
Speaker 4: Right, all these other costs, those costs are still realized.
The profit is not. It's moved.
Speaker 1: Yeah, profits moved, except there are US banks that know
they have high risk transactions and they know it's laundering,
they know it's cartel money, but they'll look the other
way for their percentage. It's the same thing that we've
talked about in New York City, well in other cities.
In fact, Eric Adams he called this out. You know,
I don't want to say the mayor of New York
is getting red pilled. But ever since he made the
tremendous mistake of speaking truth about mass illegal immigration in
his city, and you know who's in the saying, guys,
help me here, I need some money.
Speaker 2: Ship them out of here.
Speaker 4: Man.
Speaker 1: People are seeing people see what we're doing. This is
affecting my political career. And Eric b fine, you're in
a democratic city. We're gonna take care of you. So
when he told them, he said that now the DJ
is investigating him. He actually came out. Then he wants
to house these people in neighborhoods. He just wants them
out of the city.
Speaker 4: Man.
Speaker 1: He wants give people bonuses to put them and build
a spare bedroom and your additional dwelling unit. But he
said something that you and I've talked about. He said,
there are banks that are taking a raak for the
money they hand out to illegal immigrants. It's so just
tin get this. We are taxed at by force. It's
taken from us, given to government bureaucrats who number one
pay themselves number two stock up for their retirement guaranteed
pensions no one else gets. Then they take that money
and they give it to banks, and the banks go sweet,
thank you. Oh, we're gonna have some management fees on
top of this. I mean, it shouldn't top out. You know,
it's probably not more than seven percent to do what
So put it in our account and then give people
a six cent plastic rectangle that's a debit card. And yeah,
we've got some infrastructure stuff ATMs et cetera. Probably costs
us up to one one percent each time you scan
the card. If that, if that, and that economic activity.
I mean it's tracked, but is it really tracked given
the opportunity loss? I mean, you think about and we
don't talk about this. This is also an interesting question.
Speaker 5: Well yeah, that's also just so so if we just
if we just look at money going to especially illegal immigrants,
the same thing that that that is a that is
an economic activity black hole.
Speaker 4: And the reason why I say.
Speaker 5: That is because so the banks are still making money
on us, So that's going to count towards GDP in
that funny. In that funny, the banks benefit from it
almost somebody else does, right, And and and the reason
for that is just simply, when you look at the
amount of money earned or given to illegal immigrants by
the government or through their job or whatever, a disproportionate
amount of that money gets shipp back to wherever they're.
Speaker 4: From on average.
Speaker 5: Right, So so that is like a transporting of GDP
outside the system.
Speaker 1: But there's a rake. There's a rake. Western Union takes
a rake, Venmo takes a rake, PayPal takes a rake.
Everybody takes a rake except us. Yep, what's that whole
saying about? When you arrive at the you're playing a
poker game, you.
Speaker 4: Yeah, and you can't spot the sucker at the table.
You're the sucker.
Speaker 5: Not not only not only are we not taking a rake,
we're paying for it. We're paying for it, right, We're
paying for it in so many ways. We're paying for
it in higher inflation, less housing availability, we're paying for
it in we're actually paying for it, right, So it's
actually our dollars that are be giving to these people.
Right and now, let me let me, let me flip over.
This is not an argument against immigration, right. We need immigration.
Our immigration is one of the cornerstones has made this
country great. And and that you know, that's that that
that is the that is the fiber of the United States,
and it's one of our largest advantages going forward. But
we're not we're that's not what we're doing, right, In
my opinion, this is not a push for better immigration.
Speaker 4: This is the dissolution of sovereign borters.
Speaker 2: It's but it's something else.
Speaker 1: And and that's such an interesting point that this has
come along in an economic discussion, and I want to
get to this so so remind me to get back
on that exact point about immigration and mass immigration and
something else, because it should be that immigration should be
a supplying demand topic. It should be a supplying demand topic,
but it's not. There's something else going on. We'll talk
about this with Zach Abraham as we're talking about the
economy and we're talking about how rigged it is or isn't,
and it is, it's clearly rigged. You can continue to
do a lot of business with people who rigged the
economy or not, particularly just in a staple item soap.
Speaker 2: Take that for instance, just for instance.
Speaker 1: I mean it's not like I have a soap company
to talk about, but just take for instance, soap. You're
going to buy it for the rest of your life,
and you want to be unless you want to be
a stinking, disgusting, filthy hippie who walks into video studio.
He doesn't stand there with his arms crossed like he's
a boss. Actually, we should put this guy in camera,
really should see if you'll come over a camera, or
you can go to Alan Soaps. Alan Soaps is all
natural soap made in America. It's created by family with
three generations of soap making expertise, and the soap is extraordinary.
It's invented by a young guy named Alan who is
nonverbal essentially because of autism, has all these structural health concerns.
I kid you not when I tell you that the
doctors looked at Alan as a little tiny fetus in
mom's belly and said, what don't we and his parents
said no, no, So the soap company exists to give
Alan a job. Now, his brother Ian works there. He's
also got autism. And another young lady imagine a heartbreaking
this is she was neurotypical and then got autism late
in life. Man, it's so frustrating. She works there, she thrives.
So it's far bigger than the soap. So make the decision.
Be a stink and hippie, drop the soap altogether, in
which case you're an outcast and we don't love you.
We still love you, but you stink. Or go with
the corporate dedentities that don't care about you.
Speaker 4: Or just do this.
Speaker 1: Go to alinsoaps dot com, slash Todd, get ten percent
off all their products there, and just make a commitment. Man,
I'm not going to deal with these rigged economies. Zach
Abram's with US Chief Investment offs for Capital Management. So Zach,
we were talking about immigration. You made the great points
that you're not making an argument against immigration. But let
me say this, it's not just the dissolution of our borders.
It's the dissolution of our electoral college. We got that.
People all understand that now and to say otherwise is
a ridiculous claim. But it's also the importing of ideas
and attitudes and behaviors. And it used to be by
virtue of people going, man, I want to get to America.
Why right, Because man, I want to compete to get
in America because there can start a business. Derek can
have religious freedom, liberty there. It can pursue life, liberty
and happiness there. That's guaranteed by the constitution. It's unalienable.
They recognize it. Got credit, Man I want to rush
into it with this competition to get to America. So
what did we get? We got to sit back and
go like an elite college. Right, And the elite college
just used to care about your behaviors and your attitudes.
Now they only care about that if you're white. Well,
this wasn't really a four point zero I mean it
was a four point zero zero zero zero zero one
or three.
Speaker 2: Point nine nine nine nine nine.
Speaker 1: This is to keep the white people out we in
our country no longer have this competition to get in,
so yeah, it should be a supplying demand.
Speaker 5: Yeah. And to argue this may not be the best analogy,
but to argue the opposite to me is it is
to make the argument that, and it's not crude, but
bear with me for a second. It would be not
admitting that and not acknowledging that that relationship would be
like saying, you know, hey, I want to gir, I
want a wife.
Speaker 4: I want to try to find somebody i'm gonna marry.
Speaker 5: Right, So somebody looks at you and goes, well, you
need to get around big groups of people, and you're like, okay,
well I was invited to a church, but I was
also invited to a swinger convention.
Speaker 4: Both both are going to be good, look good to
look for wives.
Speaker 5: Right, They're like, well, look, both places will have people
there looking for other people, but for completely different reasons, right.
And I feel like that's one of the things that's
gotten lost in the immigration debate is that, first of all,
there's a lot of people on either sides of the
debate to say really stupid things, but the intention, right,
what are they showing up because they want to be
at a swinger convention orre they showing up because they
want to find a spouse. And in the past, the
way our country was set up with Look, and I'm
not saying there shouldn't be social safety nets. I think
there should be. I think that we use them incorrectly.
But when people were immigrating here from Ireland, you know,
at the beginning of the or right before the twentieth century,
at the beginning of the twentieth century, they weren't coming
here to get an ATM, a free cell phone and
a guaranteed job.
Speaker 4: Okay, that's not why they were coming here.
Speaker 5: They were coming here because they wanted the freedom to
be what they could be, right, right, So that was
like the equivalent of going to the church to look
for the spouse, you know. So now we're saying, hey,
it's a swinger's convention, and we're shocked that a bunch
of people that have no interest in adding to the
productivity of the country is showing.
Speaker 4: Up, right, right, And that's now is that rit large?
Of course not.
Speaker 5: But what I'm saying is you've perverted the incentives. Once
you pervert the incentives, you should not be surprised.
Speaker 4: But you sapse. Yeah, and when and when Trump makes
his outrageous or seemingly outrageous comments about you know, it's
the worst of people.
Speaker 5: Got he's correct, like, that's not the summation of people
coming in. But you have a much higher percentage of
those people immigrating to the United States than would have
in the past, particularly differential statement.
Speaker 1: No, the incentives are wait, I get ten thousand dollars
free cash, twenty two hundred bucks a month.
Speaker 4: What if you made that same offer to every American?
Speaker 5: You know how tourism in New York State would go
up and go through the roof, right, right, So of
course you're gonna get You're not gonna get the same
quality of people with the same aims coming through the border.
Speaker 4: You're just not.
Speaker 1: Yeah, And it's not racism to say that. It's human nature.
It's human nature, that's the human condition.
Speaker 4: It's has nothing to do with race or where you're from.
Speaker 1: So we're gonna go rapid fire through some of the
things you tweeted, as hard as that's gonna be. But
you can be professor Zach, but in truncated form, because
some of this stuff is intense and interesting. It's all
interesting but we'll go rapid fire through this, and you
like me, can use bone frog coffee for rapid fire,
but not bone frog wine because when you get the
bone frog wine, you get the Biden bright. Now, don't
go get drunk in the wine. Tim did not create.
Don't And by the way, he does not sell wine bogs.
Did you you know?
Speaker 4: I doubt what one guy?
Speaker 2: Okay, did you you need bone frog sellers?
Speaker 4: I gotta do. I got to get some bone frog.
Speaker 2: You get good bone fog shows. Did you ever beer
bong wine?
Speaker 4: No? I beer bonged a lot of beer.
Speaker 1: Okay. So I got the idea one night when I
was not at but hanging out at North Idaho College.
I thought it would be a good idea to beer
bong a bottle of cabernet.
Speaker 5: Now I would have probably told when I was the
same age you were when you did that, I probably
would have agreed.
Speaker 1: You know what, I've never been more sick. I've never
been more sick. And I'm talking about well, no, that's
not true. The thirty nine comic cazes in an hour
and a half in Seattle, Sweet Moses.
Speaker 2: Yeah, that was the stomach pumping.
Speaker 1: That was the thing where it seemed like a good
idea to us, this guy and I who took this stuff,
and we ended up fighting later. He and I had
wrestled against each other in high school and we both
wighed about two twenty at that time, so we fought
wrestling and turning to fight upstairs in the frat house.
Frat houses are so disgusting, and I we broke the walls.
Oh yeah, we just like destroyed the hallway. They kicked
us out, and this guy's name was Eric, and he
and I decided it would be a good idea. After
having been kicked out of their frat house. We walked
along and there was a dance going out at another
frat so we thought it'd be a good idea to
sneak in, being that it was a private dance between
a sorority and a frat.
Speaker 4: Again, I would have agreed with that being at.
Speaker 1: And then we climbed the water pipes and got onto
the third floor. Was the first open window we could find,
So we're hanging off the water pipes. We sneak in
and then we go downstairs because who's gonna notice out
of private dance, which which by the way, a formal dance.
And here we are in torn sweatpants, and then we
further thought it was a good idea to accept the
offer from the brothers in that fraternity. You guys can
leave or will help you out try it. Oh yeah,
So when I woke up in the hospital and there's
black stuff on my chest and with the thing in
my mouth that I try to talk and they eventually
had they had to put charcoal activated charcolate. So now
that's a good time to talk about bone fog sellars.
Speaker 4: Yeah, I mean as good as time as anything, because.
Speaker 1: We're adult, even bigs. I don't drink wine, but you
like it. A lot of my dear friends love wine.
So Tim, just like with the coffee, he consulted wine
experts to teach him how to make the wine. There
was the twenty fifteen vintage we had at our house,
and friends of mine who absolutely love wine absolutely loved
this wine.
Speaker 2: My friends who are casual drinkers of wine loved it.
Speaker 1: My daughter who's very brand new to wine because she's
not legally allowed to have it, she thought it was
delicious as well. So you can go and she had
a half a glass. She can wine bong in her
own time. Pray to God she doesn't go to Bonefrogsellars
dot com. Slash Todd bonefog Sellers dot com. Slash Todd
get ten percent off their wines there, and yes, of course,
ten percent to proceeds goes to the Navy c Foundation
to help the alies of fallen Navy seals. Zach, let's
go through some of these tweets real quickly, rapid fire style.
You retreated something from Anthony pomp Leano. Man, I wish
I had that name. I'd love to walk around people said, which,
my name.
Speaker 2: Is Anthony pamp Leano.
Speaker 4: You can call me pomp. Here's my buddy's circumstance.
Speaker 1: Unrealized losses that US banks are seven times higher than
during the two thousand and eight financial crisis. And this
is from coin Telegraph. Insane and I forgot to grab
your response to this. But okay, unrealized gains loss that's
such a weird thing. Unrealized gains meaning losses on investment
securities seven times highed during than during the two thousand
and eight financial crisis.
Speaker 2: Okay, unpack that for us in like three minutes.
Speaker 5: So I don't agree with the guys conclusion to what
he does with that. But that's that just has to
do with the collateral and the bank's balance sheets. They
own tons of treasuries and bonds. Interest rates and went up. Yep,
you know, whether we're talking about commercial real estate papers
and hammered so banks are sitting on really beat up paper.
Speaker 4: But remember if that, Yeah, so the Feds washing it
for them.
Speaker 5: But yeah, I mean it's yeah, there's there's a lot
of stuff that's underwater on paying balance sheets because rates
have gone.
Speaker 4: Up, and yeah, got it.
Speaker 1: Okay, So then there's this this is from Bravos Research
warning banks are still tightening credit conditions. Such conditions have
preceded recession since nineteen ninety. This time is no different.
And you wrote back, what we're lacking in credit creations
being more than accounted for with the seven percent deficits.
That's what you just explained, right, yep, just explain that
the deficit spending is a it's a plus to economy
because hey, look economic activity.
Speaker 4: Well, yeah, one percent.
Speaker 5: And then you look at the way they define a recession, right,
A recession is two consecutive quarters of declining GDP. And
so what our argument has been when you're running deficits,
this high. You could absolutely be in a quote unquote recession, okay,
where the purchasing power of people's well, in a recession,
technically the purchasing power of your money goes up because
asset prices fall. But you could have a recessionary type impact,
a recessionary type feel economically in this country and yet
still be showing GDP levels that are going.
Speaker 3: Up every year.
Speaker 1: Got it, okay? And then last thing is actually good
news as I see it, the kobyc letter.
Speaker 2: I didn't say that.
Speaker 1: I think kobusi Cobyci letter. The US dollars share of
global payments hit forty nine percent, the most in twelve years.
According to Swift data. Over the last two years, US
dollar usage and international payment transactions has sho up by
nine percentage points.
Speaker 2: And you're right.
Speaker 1: Appears as though the inevitable collapse of king dollar is
upon us.
Speaker 2: Lol. And I get that. That's pretty easy to parse.
Speaker 1: But the rest of the world knows that our books
are cooked. Yeah it's or there's okay, got it? So
we just we cook a better book.
Speaker 5: Yeah, well no, I mean, we just have a more dynamic,
more complete economy, right, So we And this is the
point I've been trying to make to people, and people
always take it the wrong way. They think that I
don't don't understand the debt situation, that I'm not disgusted
by it, like I'm sitting here saying no big deal.
I'm not at all saying that. One of the jokes
I've got with a good buddy of mine that runs
a fund is our joke is the ultimate form. So
if we take if we take inflationary or not liking
the dollar, or an anti dollar position, if we take
it to its ultimate extreme, if we go far enough
out of that curve, you end up thinking the dollar
is going to go up?
Speaker 4: Okay.
Speaker 5: And the reason why is you start to understand when
we talk about currencies going up or down, we're talking
about them in relationship to other currencies. And so a
really quick litmus test on this is you look at
somebody and you go, okay, you think the dollar is
going to imminently collapse. What other currency are you going
to put your money into?
Speaker 4: Okay?
Speaker 5: And nobody has an answer why, because those play whatever
we're saying about the US economy. Let's go look at
Japanese books, Let's go look at Chinese books, let's go
look at Eurozone books. Let's take into fact that the
US economy or the United States, is the only country
in the world that are net exporters of food and fuel. Right,
and you're sitting there saying, yes, I think what we're
doing is insanity. I think what we're doing is going
to lead to the eventual loss of the dollar as
the world reserve currency. But it's not going to lead
to a collapse of the dollar against other currencies because
it is still the cleanest dirty shirt and.
Speaker 2: It just is Yep, yep, yep.
Speaker 4: Oh got it.
Speaker 5: And that's and we've been making that argument for a
long time. And here we go, more proof of it. Right,
all the dollars in a minute collapse. Well go look
dollar transactions as which means more people are more people
are trusting the dollar in financial transactions today than they
were even four years ago.
Speaker 2: Yep, yep, well said, got it.
Speaker 1: Thank you, Zach, chief investment officer for Bulwark Capital Management,
Say hi to your beautiful family.
Speaker 2: We missed you in the high Mountains of Free America.
Speaker 1: If you buy some of that wine, don't bong it,
but let me know what you're thinking that.
Speaker 4: Yeah, no, we'll be sipping.
Speaker 1: I'm sure Tim Obeber leieved to hear that. Lord, thank
you for providing us dear friends, particularly Zat Abraham, chief
investment Officer, boat Cup for management. Think I said that
twice in about six seconds. Lord Jesus, thank you for
reminding us about wise counsel, but using simple things to
shame the wise. This is the Todd Hermershew. Please go,
be well, be strong, be kind. Please make every effort
to walk as Alex ever so gently racist in music,
to walk in the light of Christ.