what is faith. in a world corrupted you need to descend. to join us in the depths. or a made in the shallowness. hi i'm max kaiser this is the kaiser report let's see what's happening shall we let's talk to stacey max apparently distorter will as confucius warrant now this is an entertaining title i like it and it's from egon von grier it's he says that when bubbles burst we will discover how very few superior men there actually are as defined by confucius who said the superior man when resting

in safety does not forget that danger may come when in the state of security he does not forget the possibility of roone when all is orderly he does not forget the disorder may come thus his person is not endangered and his states and all their clans are preserved so. who runs cold switzerland dot com has a big gold bug he believes that disorder is coming and no man is prepared many states are not prepared for the disintegration of the everything bubbles yeah yeah yeah i've been studying these gold bugs you know for a while and as gold continues to lack the last really go nowhere there reaching deeper and deeper into the canon of quotes to come up with something to say here we are quoting confucius to add some content into the blogosphere while gold continues to do nothing. well that's an interesting

idea and the disorder may come some day and there we may see gold go up some day that's true it hasn't happened in the last year or so or so or so but it might happen he does have one or 2 sentences in this piece about gold saying that he believes that gold is a good safe haven. for this but in particularly he's talking about inflation and and possibly hyper inflation coming in the 2nd half will be speaking to rick ackerman who does not at all believe and hyperinflation or actually mass inflation he sees deflation coming and therefore that will be the chaos that will be that the disorder to come so we're we're showing 2 sides of this argument from the outside the bitcoin world what the what the other analysts looking at the data of the debt what they see so eaten by grier sees that all the debt causing inflation. rick ackerman sees all of that debt causing deflation in terms of what grier's is

presenting he's saying for example that just take the u.s. when trump was elected in november of 2016 u.s. debt was at 20 trillion dollars based on history i forecast that it would reach $28.00 trillion in january 2021 and it did and 40 trillion and 2025 at the same most market observers found this forecast prosperous but sadly they haven't studied history which told us what would happen of course it has hit 20 trillion 28 chilean and now he's predicting that in fact that forecast of 40 trillion by 2025 is an underestimate that it will be even higher i don't seem to understand how the economy can take on so much debt and at the same time prices for stuff are skyrocketing right so take that in the example of houses you know houses are up like 20 percent a year and. that's not consider inflation and the

government in response is printing lots of money or in expanding credit to encumber the country with more debt. so it's not inflation or deflation it's a it's a case of misrepresentation essentially in that you've got those who have the most capital also own the media outlets so they they present an illusion the hologram a story propaganda on the mainstream media outlets and they use of terms like inflation and deflation they use them incorrectly they should be talking about feudalism and meal feudalism they should be talking about hyperinflation as because it is demonstrating everything isn't a hyperinflationary collapse against big coins so those are the echoes of the real things that are happening for real but you don't hear that you know the narrative that they present is that they say celebrate and applaud so when your house prices

going up 50000 a year as the median price went up last year in the united states 50000 well they celebrate like that's income for you you have more equity you have more value you're rich you're getting rich they don't describe that as something that we should be against that i.e. the next generation gets locked out of the housing market i remember a very early report actually back in like 2010 we covered warren buffett actually said that at that time it was after the collapse of the housing market and he said i don't know why anybody celebrates house prices rising like that anyway it's just an intergenerational wealth transfer and it's not an asset like any you know in ordinary person should consider it's a. you know it's a huge cost it's a burden well explain to someone explain to me why jay powell over at the fed and janet yellen

a child sharee well look at the house price up 20 percent annual ising prescience 20 percent look at the short chart of that and they'll discuss that and they'll call that deflation. can you explain to me why they call that the flashman it's like saying holding up you know a duck and saying this is a turtle break or it's like saying pointing to the sky and saying the sky is orange i mean it's just us it's a patent levy false statement it's a frick him or why it's a lie it is a lie so why where is the new york times or the washington post where is c.n.n. words may say media these are 2 important people in american life and they. say. the ugly. from jay powell and john l.

they lie. and yet moans covering this people are suffering so i wish. there wasn't the the amount of suffering up there is but there's nothing i can do about it because the there's a tolerance for lying sadly well if your net worth depends on that lie then you end up believing you're willing to suspend disbelief that anything else could happen now in terms of that u.s. government and what grier's sees as his future and terms of where the debt is going he also gets really interesting data on the compound and how much debt is compound doing in america on the government level so he said based on current situation of the us economy and the forecast the deficits in credit expansion 40 trillion dollars in 2025 is too low and we are now looking at u.s. debt a 50 trillion dollars remember that when reagan took over in 1981 the us debt was

under one trillion dollars so 44 years later the debt is forecast at 50 trillion in 2025 that is an astounding compound annual growth rate of 28 percent of u.s. debt between 19012025 this figure does not include potential defaults in creditor derivatives markets which could increase the 50 trillion $1.06 exponentially total us debt of $84.00 trillion can never be repaid and nor can it be serviced at non manipulated market rate but let me explain of the ugly truth of what's happening in america so you've got these tens of trillions of dollars worth of debt and heading to 50 trillion dollars worth of debt which is just another way to say u.s. government treasury bond yeah which are currently the 30 years are roughly 2 percent now how do the coupon or the interest on those 30 year paid they're paid from taxes collected from tax payers and they taxpayers pay those. taxes to the

federal government who in turn pay off the bondholders who own those bonds the richest 110th of one percent it's a wealth transfer mechanism so it's not inflation it's not deflation it's nail feudalism it's the u.s. government in cahoots janet yellen jay powell and whoever the president is at this time i am not keeping track but they essentially coordinate and conspire to issue trillions of dollars worth of debt and the interest has to be paid by the u.s. taxpayer most of your taxes now go to the top 110th of one percent to pay their bond interest by design that's not inflation that's not the flesh that's not democracy that's not a republic that's neil feudalism and the people obviously who can't afford health care can't afford housing can't afford to keisha who are living in the mud living in the dirt in america opiate addicts strung out on dope all day they're not having a good time but nobody covers because if they did as you say they would lose their jobs. right well again like

a lot of people like the inflation and the house prices that are the result of of these huge amounts of that but also the way describes that is like ok they dream it is going to collapse as well just says brooksley born predicted back in 2000 that it would cause a financial crisis as it did in 2008 and it will do in 2021 or 22 or 23 soon once it all collapses but that sounds deflationary to me so just as rick ackerman in the 2nd half will argue but he's saying that that will cause a currency crisis and all hyperinflation is our currency crisis so he thinks it will cause you know the currency grid to collapse and therefore cause the hyperinflation i think so you know watch the episode make your own decision on that but here's another example. of people celebrating australia you know we've covered that head steve many times over the years he was always talking about how the

bubble is unsustainable there and yet australian house prices forecast to see the sharpest rise since the 1980 s. at least in the introductory paragraph they do present the downside of this as we have done here on the show and grim news for aussies trying to get their foot on the ladder of the property market house prices are tipped to soar by a massive 17 percent this year across our capital cities marking the fastest pace of growth since the late 1980 s. so they're establishing that the younger generation as warren buffett said it's a wealth transfer from the young generation to the older and they do point out that it's all to do with government programs the government is intervening in australia on behalf of a certain sector of people i.e. the voters that vote the most the ones that will be happy with the price and therefore continue voting for those policies whereby you know those struggling to get on the housing ladder hopefully for the politician they're working 3 or 4 jobs

to save enough money to get on the housing ladder so they don't have time to go vote so you know these are the sort of this is why these schemes happen and enough if you get enough of the voters to support your scheme then obviously you can continue to win reelection then these terms are ludicrous so it's like you have a shop on main street somewhere in america the government agents show up with baseball bats and they smash everything in the shop they steal all the inventory and they set fire to your store is your response going to be gosh i'm really suffering from deflation. now that's not what's happening it's a coordinated heist by the plutocrats against the many and the result is futile as a male female is on and that the whole lockdown is just preparation for mass incarceration i'm afraid but that's the life in laxity well certainly in the wealth gap did explode in the past year and that is the set up of this that whatever it

whether it's causing inflation deflation or hyperinflation the fact is there is a a massive feudal like situation where the likes of jeff bezos the multibillionaires became closer to trillion our status in the past year and you can't deny that that's in the facts in the data and that's because all the money printing does boost asset prices that's what the fed wants that's what as danny blanchflower used to be at the east bank of england he said that's what they wanted as well by quantitative easing so that's what they've got but whether or not it causes. disorder will. confucius want to spark i will be back don't go away.

so what we've got to do is identify the threats that we have it's crazy. let it be an arms race. and spearing dramatic development only really. i don't see how that strategy will be successful very critical time to sit down in. history. to spend millions of euros in you know being to delay relations i will be sniffing all about making money making profits in some of the corporations international markets import export do you imagine the number of chronic diseases that are out in every community today it is not due to new viruses own new microbes in fact it's not true so it is due to environment. not going to say you know the

momentum is simply the. muscles are really just accumulate could only come in to be seen to be so in the us that. the legacy of the skull if the so food industry is successful it will create more jobs it will create more value added it will create more growth so i don't see why we shouldn't also fight for the interest i think into st outset that we have regulation we want regulation i was in just belief we don't behave zinnias penalty just fine. welcome back to the kaiser report imax keyser time out to go to rick ackerman of rick ackerman dot com is a former market maker turned stock picker and newsletter publisher rick welcome back max thanks for inviting me on always

a pleasure now you write that biden's $2.00 trillion dollar project that he's working on is a trojan horse what i mean by that supposedly about 5 percent of that money is for potholes roads and bridges and the other 95 percent is in one way or another toward what we call social engineering and there's even a little bit of weather control when they're so i'm afraid that this 2 point truly in dollar stores or kit is just a down payment on an environmental plan that could cost a lot more no boondoggle left behind it seems like we're getting back to the a period in american economic history of boondoggles and because the folks who put those up of course make a lot of money at the expense of the taxpayer looks like taxes are going up across the board wreck what do you think just great you know the stock market hasn't figured that out yet if they're serious about raising taxes and you know raises the

question if we've been spending trillions up to this point for that we're not we're essentially untaxed why do we have to start taxing now yeah you know that's one of the mysteries of life you know that there's an interesting development in corporate america shortage so automobile companies are not really delivering cars and this is rippling through the entire economy is this the beginning of a major infrastructure. kind of crisis where the america has shipped that jobs overseas for decades that has. and invested in chip manufacturing in decades you know that got less than 5 percent of the chip market they still have over 50 percent is this the beginning of a kind of coming to realisation that the the lack of an industrial policy that i guess you could put it one way for decades and the financialization that seconds place has run its course and is this a partridge acted is this a is this just

a flip a blip in the or is this the part that kind of crisis on the on the chip and everything that goes with it rick well i think the difficulty here is we you know when you talk about spending money on infrastructure or even for that matter wafer. plants that you build for $5.00 to $10000000000.00 the question is building for what and you know you have to be able to envision the economy the a future to get the infrastructure right and right now i think we're really adrift to strew what the what the economy might be you know i think the average working man looks at it and he says he's doing whatever to make a living but there are so many things happening in the economy about which you could ask the question will does this really contribute to the economy so we've got this notion about being in headfirst with 5 g. . transmissions and things like that but i think there's really

a big huge unanswered question as to what what economies it will support just more time of a return to an imaginative thinking meanwhile the debt surpassed 28 trillion in the us money supply increased by 25 percent last year. how do they how do you now let's get in the into the nitty gritty of portfolio management you know if got a classic for folly off stocks and bonds typically have to know how to allocate what if 20 twentieth's really. debt does that mean anything rick. it really doesn't and you know it's a big number so it has to have a consequence does it my way of looking at it even though we look at it and say well wayne quake nobody's ever really going to pay it in fact we will have to pay it and that's kind of where i was my starting point may be 40 years ago when i read

. c.v. myers on the coming deflation eventually all of that will have to be repaid if not by the borrower than by the lender and so so 2828 trillion is a number we can't even wrap our heads around that but you have much bigger economies the the. i keep coming back to the derivatives market which amounts to something like depending on whose estimate a one quadrillion to 2 quadrillion dollars so that is so much bigger than the actual global economy of goods and services. it is so it's really hard to put $28.00 trillion dollars into perspective but trust me it will all have to be repaid at some point the number one component of the global economy is creating bet that if it's an vastly surpasses the underlying compound any other component the economy so the number one activity of these major economies is just

a print debt and the number one reason they print debt is a transfer income from taxpayers to the people who own the bat. i mean that's not even when we say inflation vs deflation it seems like where it's a little it's a losing argument from the get go and we should be talking about feudalism purses non-fatal as a missing bank feudalism to me it just ama and out of control oligarchs who are doubting their economy to death well and that's not it that's feudalism or i think the word feudalism really touches on it it almost answers the question of inflation or deflation you know i've held to a deflation endgame. simply because we would yes the question well which way is it going to go it will go in a way that most benefits the big players the really big money interests who've done all the lending into mortgage markets and who essentially cost to the lenders in

the in all bond markets so the game things are to definitely going to go their way although i don't think it's going to be controllable. but. you know when you take mortgage debt alone. it's an incumbrance and that's what i when i look at deflation i don't talk about an increase or decrease in the money supply i simply talk about . an increase in the real burden of debt so i think we're all going to be encumbered in the future and i don't think the mortgage lenders are going to allow us to peel a few 100000 dollar bills from our hyper inflated wallets as payment for for mortgages so will always be under mortgage debt which is the biggest piece of what most people oh and that's why i think it's very strongly convinced that all mortgages will eventually be rewritten as leases so once again. to follow up on that the sense of ownership disappears and you have people are rants are are

are are indentured servants effectively and the idea of private property gets dead it out of existence and so as you point out your main thesis for many years now has been deflation and to follow up on we just said it's more structural in other words when you say years i mean say inflation versus deflation or saying well there's a business cycle and sometimes you know the debts get high and then central banks might increase rates that if g.d.p. is going into rapid pace and that there's a dynamic there and they're managing the economy but you're saying now there's no business cycle there's only one cycle it's down down to permanent deflation and wealth transference to the top that's never going to structurally change and you're saying property owners lose everything and become lease they lease the he's on this economy i mean that that's kind of the bigger picture rick yes they've been eased

into that situation max you know inch in california if you go down to orange county and you buy a little 1100 square feet. rancher for $800000.00 and i think no one who's in those homes really thinks well i'm ever going to own it i'm ever going to pay it off it's just a matter of maybe prices will increase and i'll trade up to something else then i can afford even less so it's been kind of a ponzi but but over over time the idea of actually being a homeowner of owning an 800000 dollar 1100 square foot rancher that you know is not worth anything near that. is to it's not feasible anymore so is 1st property ownership we don't really own nice homes anymore especially in places where own prices is a phenomenally inflated to stick on your thing at the if last and yet you would therefore imagine that the 30 year bond which is currently only about 2 percent

e.c. room for the yield to go down even more as the central banks and days and yield control which would just be a more purchases and more controlled by the central banks and and that would just keep the same the widening wall the wealth and income gaps on track to just get worse and worse so on the bond market reg i'm i'm taking in the 30 year bond at 2 percent you see this. going lower on the yield i guess is what you're thinking right yes i do and even though you know talking about deflation is very counterintuitive when you see all the the monetisation in the fiscal ramping up that's going on all over the world right now deflation is very counterintuitive but i think you have to sort of separate out what you would call a process by which we've been keeping deflation at bay from kind of a day of reckoning when we really need inflation in a big way and

a lot of it very quickly so the best dorg human side of seen. against deflation or at least that the pro inflation arguments come from people who deeply understand what the fed does they understand exactly how the fed puts money into the system and for that reason they understand that the fed's ability to do that is theoretically unlimited but at a and that's what's happened we've had sort of an increase in a creation of inflation and we've had monetization and a fiscal blowout. that is part of an ongoing process and stow the the hyperinflation guys say. you know hell yes that is the fed can do whatever it takes and that's true if you look at it as a process but if you look at it the system is someday imploding under its own weight the encounter inflation that would be needed to prevent that implosion it

has to happen in in 36 hours you know that the fed would have to sort of take this giant hole that's blown out in this in the bubble and patch it up as it's t. flayed ing so so that's the the kief flaw i think in the hyperinflation logic that somehow the fed will be able to counteract and even in some imploding systems the fed can't do what it's doing now you cannot loan a ties a collapsing pension system and if you take as a given that illinois pension system will be the 1st to go it's not the same for the fed trying to inflate financial assets real estate the stock market as it is to inflate a collapsing pension system there are going to you're going to ask and hold that thought and i'm going to carry this hour to a 2nd segment but thanks ron on this kaiser report rick thanks for having me on max

always a pleasure and that's going to do it for this edition of kaiser report with me max kaiser and stacey herbert want to thank our guest rick ackerman of rick ackerman dot com and so next time by all. still seems wrong. but i'll roll just don't call. me i'll be yet to say proud disdain becomes agitated and in danger but he lost the trail. once a month and find themselves worlds apart we just a look for common ground. i mean this is a bit like it's a small it's this if. you do this for the 1st one to the finish to go forward from

the hundreds. that shows you just sort of do want to catch. people think it was national guard coming off. the top of. the. w. . bush from the films. will support school board of these critics one of people's music and nobody knew the least because between. the shingle why for the smear. of the sunni muslims. to follow someone to be renewed because we've got a lot of stuff like you know it's that easy.

pharmaceutical giant. union. joe biden could meet in person for the 1st time as heads of states in the near future takeaways following a phone call between the 2 presidents also ahead. state of emergency is declared in minnesota where a curfew for a 2nd straight night following the fatal shooting of a.