actually ago, this is some of the story books that talk about young children transitioning. you know, they make it signed simple. you know, i don't know if the children have got no understanding of the medical and surgical interventions that the child that goes down that pathway will be lacking themselves in full rep set up for they shall appreciate your company here. and auntie joined me for more than 30 minutes. mm. i the welcome back to kaiser report i max kaiser and stacy herbert with another special

episode. summer solutions today were talking with john ruby now of dollar collapse dot com. stacy right 2021 has been the year of the i word inflation. even the central bank is mentioning inflation. is it transitory? however, as the central bank is arguing, or are we going to see something worse coming forward in the next year or 2? yeah, we have inflation all of a sudden after what, 2 decades of 0 inflation and all of a sudden we're at 4 or 56 percent depending on the, the measure use. and the interesting thing about this version of inflation is if there are a lot of cross currents, you know, there are a lot of what they call base effects where we had kind of deflation at the beginning of the panoramic. and so the year over year comparisons are exaggerated by the really low numbers back that and but then we've got spiking industrial commodities and all kinds of weird supply chain things going on that's forcing

manufacturers to pay way up or whatever they want. so it's really hard to tell how much of this continues into the future and how much is going to get fixed. for instance, right now, a lot of the, the industrial commodities out there and agriculture commodities are starting to correct like lumber after quadrupling in just a couple of years. and spanking the cost of building a new house is back down by $40.00 or 50 percent. so the question is, does that, you know that the new trend will, will commodity prices start to go down and will that filter through to inflation next year? i make it lower than people expect. i have no idea. but that's all you know in a way irrelevant because does the, the macro longer term trends, all point to rising inflation out there in the sense that we're borrowing so much new money that has to be covered by creation of new currency. and that is inevitably going to make the value of all the big currencies go down,

which is how most people define inflation. so that's already baked into the k, you know, whatever happens this year is less important than the longer term trends. and they're, they're what they've been, you know, for the last 5 or 10 years, you've been able to point to the macro things going on out there and say that yes, the value of the big c r currencies has to fall going forward. so i don't think we should get too excited about what's happening right now. although there's always a chance that, that it spooks, the markets, you know, before it moderator that does moderate. and that, that brings about the final grade. so you know that there's so many catalysts for gigantic financial crisis out there. any one of which could tip us over the edge and this could be one if inflation stays high longer than the markets can tolerate . so ok, long answer to i guess what could have been a short question. i don't really know. i don't know if we have inflation. that is

going to go on from here for a long time, or if it's just a squiggle on the way to something much more serious happening later. well, john, we say some interesting developments. so there is inflation in the system. as you point out, it's showing up and this is leading to supply chain disruptions. a lot of shortages . the system as a whole seems to be breaking as well as infrastructure problems and the inflation st we taking of the form that you would see may be in an economy that's starting to rely on rationing. right? because the underlying economy is broken because the interest pictures decaying because the supply line can't be maintained. and so that's another type of inflation. it's not driven by money. parenting is driven by rationing is driven by total breakdown. i mean, there's potentially you could say that there is inflation in cuba, you know,

because if you try to get a pound of sugar and you don't have a rasping card, you know, that's beyond your rates, you can't afford it. right? and it just seems like that's being under priced at under it. people just have assumed that the, the u. s. economy is flowing magical orb that they just tweak at the margins and prices go up and down. but i think the actual thing is collapsing like soviet union collapsing, and this is driving some price increases. and nobody can understand that because they're not told the that aspect to a job. we're not used to that we as americans think it's our birthright, to have a system that works really smoothly that we get what we want one, we want it, you know, we make a phone call that refrigerator is delivered the next day. if you plug it in and it works beautifully and you know, it's not the case so much anymore on, on dollar claps dot com. i have a series of articles called welcome to the 3rd world about all the different ways that things are breaking down here. and i, you know, i think that the broad heading for that story could be called peek complexity. in

other words, we've created a system that is just so complex that we can't run efficiently anymore. and it starting to break down. i want a complex system starts to break down. that's not necessarily a gradual thing or it's graduate 1st and then and then catastrophic. one scenario for that to, to play out is that things do start to break down and we don't care what we want. you know, cities start to go bankrupt because their pensions are over funded and they can't maintain their infrastructure and the federal government then feels compelled to step in with insane amounts of new money, which is exactly what's happening right now. you know, we're bailing out states and localities who pretty much made their own bad by, you know, implementing, wildly over generous pension plans among many other things. and were, you know, so we're creating, trying to new dollars to do that. that affects the financial markets in

a lot of pernicious ways, and instead of helping it accelerates the process of societal breakdown. so you can make the case that's all happening to, you know, basically when you are away too much money, stuff like this is kind of inevitable. you know, things just don't work right anymore. so we're, we're in that stage of the process where we, we reap the, the rewards of inflation early on when we went to a pure field currencies and just created huge amounts of new money. and i just, just like if you were, i started, you know, maxing out a bunch of credit cards. we'd have a lot of fun with that at 1st. but then we'd have to pay the piper at some point in the future. and this is that time, you know, when things just aren't going to work right anymore. and you can point to lots of specific, you know, sector specific or cities for septic or government specific things that are going on. but they, they're all happening because of that root cause that we've created a wildly over complex system with insane amounts of new money. and

it's beyond the point of fixing right now. so you know where this happens and how it plays out in terms of timing is anybody's guess, but it definitely feel like we're heading into that stage of the process. and i don't think there are any fixes in a right now. i think the government would, would try to convince you that they've got it under control and that they, if they do this, you know, if we have the right interest rate in the right, corporate tax rate will be ok. but none of that is true. you don't want to complex system starts to break down the, the fixes become beyond complicated and they become impossible. and terry are, you know, we could be entering that time. well, all 3 of us were around since 1971. when we went off the gold standard, we've had these good times, but we're, you're starting to see part of the money printing issue that has always happened since. and certainly domestically is that we have that who said it is trap of china

rising and power and our conflict with them, causing this d globalization that you're starting to see. we also have that generation coming up generation z who are pretty smart and they kind of see that like the last one in, on this ponzi scheme. and there's a sense that they don't want to pay that. so is their mindset changing? is there, it feels like the boomers and generation acts like we kind of sensors last hurrah is like, let's, let's you know, before you declare bankruptcy, spend as much as possible because you're going to declare bankruptcy anyway. you might as well get a whole bunch of stuff. all those new cars people are paying math. they're paying over sticker price for cars at the moment. like people are just like spending wildly. why, while they can, because the solution is the next generation coming out of age and deciding, we're not going to pay. there are 2 or 3 really important points in that one is that yeah, it does feel like we're at the kind of a blow off stage where we've just given up on any concept of fiscal

sobriety. right? and you know that the us government's going to run the 3 trillion dollar depths of this year. while we have 4 or 5 or 6 percent inflation. and what's the unemployment rate now like 6 percent of the us, 5 percent, some blow number, you know, that usually coincides with fed tightening. but not this time. and as you mentioned, yeah, people are doing crazy things with their own money. at the same time, that housing market is just baffling to me, you would think that in a, in a recession which we had last year, home prices would at least stop rising, but they've just been spiking this whole time. and yes, cars, whatever you can. because right now people are paying up for it and that's ok. that could be a societal breakdown in the car market. now we're saying something here we're at used cars, of some models are trading above the price of new cars. but the same model,

if that new car is unavailable right away, people are buying a used version of it and paying more. so i've never seen that before. and it's almost as if the car market is in backward nation, which is something that you only see in the commodity markets. right? you know, the, the, the, the crazy things we've seen these markets like negative oil price, we saw last year. remember, price, oil, it negative. we saw on negative interest rates, which is absurdity. now what is trickling down to the mom and pops out there where they're paying the, the law of economics don't seem to apply in any facet of the economy anymore for anybody, john, move the car thing. that's kind of like the housing market. why in the world, do you even need a car? if you're on locked down, right, you would think car sales would fall off a cliff in a pandemic lockdown, but that didn't happen. everybody was out there buying cars in houses. i don't know if you know so much of this is, is only explainable by some kind of a psychotic breakdown. there's no real financial reason for any of this stuff

happening now. so you know, if it, if it's not happening because of straightforward financial and economic reasons, the reasons and causes than the outcome is kind of hard to predict. so i don't know . but, you know, one other thing from, from stacy's question, the younger generations that are coming along ought to be really angry. because the baby boomers have just screwed up the world. you know, my generation as basically inherited a reasonably solid financial system and then proceed to just ruined. and now we're looking at them and saying, well, ok, you know, we're retiring now get ready to pay for medicare and social security. so i think there's kind of a generational conflict coming when, when we start making our demands, we ratchet up our demands. and the guys who are expected to pay for, it's just a now sorry, you know, i think there is a, a political market bitch now,

for somebody running for president who says, you know what, we just can't do this. we can't take all the money that 25 year olds make and hand it to 70 year olds. we just can't do it. so we're just going to scale back those benefits really dramatically. all right, we got to cut it right there, but we'll be back right after this message. don't go away. the me. ah, [000:00:00;00]

excuse me. she told him breathing a little slow, letting him go by susan. well, i don't want to come a little to go with me when you have a week or 2 people meeting in the room, initial authentic, steamy guy go on the spelled on the one. let me know which company was going to look at me on the screen. you susan, this new logo is looking here when you mental to begin with. elude you miss little thing going on, but yes, the young hoody and delusion you lose. you can shoot me to the lower.

ah, the ah the ah, welcome back to the cars report more with john robina of dollar class dot com. john, i want to follow up a little bit on the dysfunctionality of the markets and the appearance of the economy to be broken. you know, here's a problem. let's say i find a vending machine somewhere. if i just push a button, it spits out a candy bar. right, and never have to put my quarter in. or my dollar belen, i just push the button and it gives me a candy bar. the reason i bring this up is we're in an economy right now where a lot of people know it's broken. and those people have access to borrowing money

and 0 percent. and they're placing bets on how broken the economy is whether there was trade or there are private equity firm. it could be warren buffett. and so they're throwing gasoline on the fire. right. instead of some, somebody standing up and saying, hey, wait a minute, let's fix the economy because otherwise we're going to drive off a cliff. you've got a lot of people now who's 24 hour day job is to try to make it as worse as they possibly can because they're stealing. that's one of the problems with excessively easy money, which flows from currency that's not backed by anything you create. what's called moral hazard, which is a situation where people start behaving in ways that they wouldn't otherwise, but because it's been made so attractive by the artificially low interest rates or otherwise easy money. and the whole world has become a place like that. now it's a casino, where everybody's borrowing insane amounts of money at extremely low rates and then

doing things they might not have done otherwise. to make, you know, little tiny profit over and over and over again on a bass gail because they can use borrowed money that inevitably leads to some kind of a crash. the problem with, with today is that you got the whole world doing it. you know, every country has a currency, every financial sector in, in every developed country as people doing all that stuff. so the leverage, speculating community is no longer the little tiny sliver of the world. it's now the, the tail wagging the dog out there. so you can't start the process like we can't ever raise interest rates again in the us. because we start out by getting a tape or tantrum from the markets, which is the markets responding to higher interest rates by crashing. but now what we get is a pre taper tantrum like we had just lately here, where the fed announced that it was thinking about raising interest rates a tiny little bit 2 or 3 years in the future. and the stock market started to fall

. so they had to walk that back. so basically it's never ending. i think the big psychological change comes when people realize that these emergency measures that we put in place in 2008, 2009 or the new normal. and they start thinking through the implications of that. so we're already seeing the super rich do that. for instance, who's the biggest buyer of agricultural land, farmland and america. bill gates, you know, a tech millionaire who probably doesn't know how to drive a columbine or a milk cow, but now he's our biggest farmer. why? because he sees what's happening to the financial system and is shifting his money into real assets that don't depend on the currency for value. and what about lap rock and you know, the other big hedge funds out there, they're buying houses for the same reason because the house is a real thing that can generate cash flow. and that doesn't depend on the way it's

a government bond. stoughton depend on the value of the currency, so their front running this process, their intention and their expectation. and i think, you know, in reality what they're going to get is that they will be our landlord and our grocery store when the time comes. and the rest of us will be debt slaves. which, you know, is a shame on a lot of levels. but the biggest shame is that the people who are hurt by the few who trust the governments of the world by holding cash and bonds and other things that come on the currency. they're the ones who end up being hurt. while the, the guys who already got rich in the run out of the financial system are setting themselves up to benefit from us eventually crash. you know, they're going to wind coming annoying. and they'll be even richer in relative terms than they are now. while the 99 percent will be poor in relative terms. so that's a recipe for chaos. but we also, as you mentioned that intergenerational thing,

i do note that the rent moratoriums are being extended yet again. so all those renters, the young people, all who can't get on the housing ladder because black rock and blackstone and all these huge guys own all of the property, well, nobody's having to pay rent anymore. so it's a weird kind of feudal system, but that relies on, as max was pointing out about the supply chains, is he and i just went for the 1st time to an electronics store. one of these big ones and shelves were empty all over and has signed saying this product unavailable, and is because of the semiconductor chip shortages. so we, at the end of the day, even the likes of bell gave black rocks and blackstone in the united states rely on the kindness of china and the rest of asia to provide us with our goods. so where, what, how does that. d resolve itself, you would think that we would just build a bunch of ship factories here. we don't seem to be doing that. yeah. but that's usually the way a market works. so the question is, is this still market, you know, it is, is there still

a system out there that responds to price signals with new production? and i'm still program to think that that's a fairly easy fix just because for my entire lifetime, that's how it's worked. you know, if there is a shortage or something then well, huge profit is to be made by going out and supplying that needed. and so we'll see in the next few years, it's possible that we're just so broken in terms of our trade relationships and technological abilities that we can't do that i still think we will. and i still think that part of the broken supply chain will be fixed, but it will be fixed that had higher prices, right? because we make chips in the us, they're probably going to have to be a lot more expensive than if they're made by slave labor. in china, so that's inflationary, right? that means the cost of all of those things that we now have access to finally after

2 years of not being able to get them. the cost of suddenly 50 percent higher. and that leads to problems in other aspects of society. so, you know, it's not a fix to, to get access to these ships as a way, you know, we can expect to over the next couple years. it's just something that exacerbates a different problem in a different part of society. and you know, that doesn't seem to be an end to that because every fix that, that you can reasonably see for one aspect of the mess that we're in right now causes problems in other parts of society. and i don't know what the solution for that is. i think that that there are no real fixes in the long run from a hyper leverage society that is on the verge of going off to financial possible price discovery rectifying. and that would be a dollar collapse, but before talking about that, you know, you mentioned bill gates,

some other billionaires in the news recently, charlie monger and ilan mosque were both coming out this week with comments. lot in china, you know, charlie monger over there, berkshire hathaway, talking about he wishes there was the chinese censorship style in the u. s. b line gods mosque talking about how you know, how great china is. and, you know, there's a great concern about how china is now dominates the hollywood, the output essentially curtailing movies to fit their local market. so we're seeing already, it seems like they're softening us up to accept more of a chinese style communism. here in the us, i mean to your point that the end result would be a kind of a neil feudalism or some kind of slavery model. it seems like they're already telegraphing that john for somebody like new gate or warren buffett. a talk down cause i dictatorship doesn't sound like a bad deal at all because 1st time in part because they already kind of sort of have something like that. they can pretty much do what they want right now and

impose whatever they want on the rest of the country. and 2nd, because they think it be run correctly because it would be run by people like, you know. so that's, and that's as old as human history where you have a handful of very rich, very powerful people who believe it is they're not just, they are right, but their duty to run the country or run the world and remake it in their own image . so this shouldn't be a surprise because they're kind of comes with the territory. the question is getting from here to there is likely to be incredibly messy, no matter what. and then the end result is not going to be what they thought or, or maybe it'll be what they think it's going to be, but it's gonna be horrendous for everybody else. so normally when you screw up your finances, you screw up your politics and we're seeing that now we're seeing a rising aristocracy. at the same time, we're seeing a, an expanding political movement that is aimed at that. you know,

populism in all its forms. shared is one characteristic which is the belief that a small group of people are screwed over the rest of us. and that there's a politician out there that can make it right. they can go back and get what's been stolen from us and, and put things back to where it should be. so that's going to be the nature of politics going forward. you know, donald trump's is going to be followed by kinder, gentler, but maybe more effective versions of donald trump. bernie sanders is going to be followed by younger and more energetic versions of a bernie sanders and are all going to be aiming their politics and their actions at trying to impose anti trust laws on big company is wealth taxes on rich people. asset forfeiture is have you, you know, you name it that will be trying to do it to take money away from the rich and that's kind of a recipe for civil war, right. you know, we're, we're headed for a time when,

when people find it very easy to humanize each other and to use the fact that they don't consider the other side to be completely human, to, to impose their will on this kind of. so, you know, it's going to be a mess on a lot of different levels, but the political side is especially scary. right now. my 5, i'm watching a series about empires. and one thing you notice is that all empires rise the peak and then they crumble and they crumble usually pretty fast. the crumbling part happens rapidly. it just seems like it's that, and we're dealing with you know, end of empire. so in the final moments here, your site is called dollar collapse dot com in a post dollar fee out world. are we ever going to have another system because it seems like the fundamental underlying problem was identified decades ago during brighton was they said, the trip and dilemma. what happened? the trip and dilemma happened? that's why we went off the gold center and $71.00. and that's why we had to export

all our manufacturing overseas. will we ever have dollars system like this? again, a fee out system hooking, fee out system. i mean, there are, there will have to be some kind of a reserve asset that, that people can trust to maintain its value for long periods of time. go did that for 3000 years or those who say bitcoin will do it going forward. so there has to be money, there has to be a monetary system. there has to be a basic asset that everybody agrees upon as a store value. now, how we get from here to there again, is going to be incredibly messy. but, you know, i think the monetary reset, part of this is really the, technically most easy to understand. in the simplest, you know, all the rest of it is chaos. but we can absolutely just name something else. is our reserve asset and then start valuing everything else. in those terms, you know, we can do that and hopefully we do it without

a civil war. but i suspect that the people who are going to be hurt by this process are the ones who leased it or be heard and that's it. that sucks. you know, i wish it was done in a just way, but i, i don't think it's going to be, i think it's going to be done in a chaotic where that impoverish has a lot of people who are already right on the edge of. but john are being dollar collapse dot com. thanks for being on kaiser report. thanks max. thanks. i'm not going to do it for this edition of kaiser report with me. my guys are in, stacy. herbert want to think, i guess, john beano dollar collapse dot com until next time via the me ah ah ah

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